>' 


SOCIAL  WELFARE  IN 
NEW  ZEALAND 


SOCIAL   WELFARE    IN 
NEW   ZEALAND 

THE   RESULT   OF  TWENTY  YEARS   OF  PRO- 
GRESSIVE SOCIAL  LEGISLATION  AND  ITS 
SIGNIFICANCE   FOR   THE   UNITED 
STATES  AND  OTHER  COUNTRIES 


BY 
HUGH   H.    LUSK 

ATJTHOa    OF     "our    FOES    AT    HOME,"    ETC. 
FORMERLY   MEMBER    OF   THE    NEW   ZEALAND   PARLIAMENT 


flew  ISorli 

STURGIS  &   WALTON 

COMPANY 

1913 


Copyright,  1913 
By  STURGIS  &  WALTON  COMPANY 


Set  up  and  electrotyped.    Published  January,  1913 


i 


8G3 


k?7 


PREFACE 


The  object  with  which  tliis  book  has  been  written 
was  that  of  placing  on  record,  in  a  form  that  could  be 
readily  understood,  the  methods  and  results  of  a  great 
social  and  political  experiment  at  once  unique  in  char- 
acter and  remarkable  in  its  effects.  In  doing  this  the 
author  has  endeavoured  to  lay  before  his  readers  as 
clearly  as  possible  the  conditions  under  which  this  ex- 
periment has  been  undertaken,  the  purposes  kept  in 
view  by  those  who  conducted  it,  and  the  consequences, 
both  social  and  economic,  that  have  followed  within  a 
period  of  twenty  years.     He  is  under  the  impression 

^      that,   while  the   country  in  which  these  experiments 

^  have  been  made  is  a  small  one  compared  with  America, 
and  while  its  people  are  but  few  in  numbers,  when  com- 

V^  pared  with  the  population  of  the  world's  great  Repub- 
1       lie,  the  value  of  the  lessons  that  may  be  drawn  from 

^      them  is  not  limited  by  the  size  of  the  country,  or  the 

^^       numbers  of  its  people. 

^  A  good  many  books  have  been  written  within  the 

"^  last  few  years  dealing  with  New  Zealand,  some  at 
j  least  of  which  have  excited  the  interest  of  intelligent 
readers  both  in  Europe  and  America.  These  books 
have  generally  represented  the  impressions  of  visitors 
to  the  country,  and  their  value  has  therefore  depended 

t       mainly  on  the  keenness  of  the  perceptions  and  the  un- 
prejudiced judgment  of  the  writers.     The  author  of 

421505 


vi  PREFACE 

this  book  has  preferred,  in  his  desire  to  present  an  ab- 
solutely trustworthy  statement  of  an  experiment  which 
he  believes  to  be  of  wide  importance  to  the  civilised 
world  at  this  time,  to  rely  upon  well  ascertained  facts 
and  authentic  statistics.  He  has  therefore  confined 
his  inquiry  chiefly  to  the  conditions  of  New  Zealand 
and  its  people  during  the  last  twenty  years ;  the  legis- 
lation which  has,  during  that  period,  embodied  the 
new  social  and  economic  experiments  of  the  country 
that  may  be  found  in  its  statute  books;  and  the  eco- 
nomic results  that  are  recorded  in  the  compilations 
made  at  each  of  the  census  periods  from  1891  to  1911. 
The  author  may  claim  to  have  had  some  special  ad- 
vantages for  the  work  he  has  attempted.  His  personal 
connexion  with  New  Zealand  has  extended  over  a 
period  of  considerably  more  than  fifty  years.  During 
this  period  he  has  taken  part  in  the  legislation  of  sev- 
eral of  its  parliaments,  and  has  been  intimately  asso- 
ciated with  some  at  least  of  its  most  influential  states- 
men. He  has  been  largely  responsible  for  its  very 
complete  system  of  national  education,  having  been. 
himself  the  author  of  the  statute  on  which  it  was 
founded  originally,  and  has  taken  an  active  part  in  the 
legislation  and  even  in  the  executive  administration  of 
the  yoimg  country.  As  a  lawyer,  engaged  for  many 
years  in  the  active  practice  of  his  profession,  he  had 
special  opportunities  of  estimating  the  requirements  of 
the  people,  and  the  effect  of  the  legislation  enacted 
from  time  to  time  on  their  conditions  and  progress. 

October,  1912.  ^'  ^'  ^ 


CONTENTS 
BOOK  I 

STATE  SOCIALISM:  WHAT  IT  MEANS 

CHAPTER  PAGE 

I  A  Backward  Glance 3 

II  The  Age  op  Commercialism 14 

III  The  Fruits  op  Commercialism    ....  22 

IV  National  Well-Being 32 

BOOK  II 

AN  OBJECT-LESSON  FROM  NEW  ZEALAND 

I  The  Land  and  the  People 45 

II  The  Land  for  the  People 58 

III  Industrial  Disputes 71 

IV  The  Eegulation  of  Labor 89 

V  Old  Age  Pensions 99 

VI  Woman's  Suffrage 106 

VII  Aids  to  Industry 116 

VIII  A  Government  in  Business   .     .     .n    .     .  126     /^ 

IX  Experiments  in  Finance 139 

X  New  Zealand's  State  Socialism     .     .     .  152 


^ 


CONTENTS 


BOOK  III 

WHAT  IT  HAS  MEANT  TO  NEW  ZEALAND 

OHAPTEB  FACIE 

I    New  Zealand  Twenty  Years  Ago     .     .     .   165 

.  174 
.  186 
.  198 
.  211 
.  226 


II  The  Land  and  the  Land  Owners     . 

III  Law-Abiding  Industry      .... 

IV  The  Ownership  of  Public  Utilities 
V  Ownership  of  Minor  Utilities  . 

VI  Protective  State  Socialism 


BOOK  IV 

WHAT  IT  MAY  JVIEAN  FOR  THE  WORLD 

I  The  Lesson        241 

II  The  Value  op  the  Lesson 256 

III  How  the  Lesson  May  be  Used     .     .     .     .267 

IV  A  Possible  Solution  of  the  Problem  .     .  277 


BOOK  I 
STATE  SOCIALISM:    WHAT  IT  MEANS 


SOCIAL  WELFARE  IN  NEW 
ZEALAND 

CHAPTER  I 

A   BACKWARD    GLAlfCE 

P01.ITICAI.  economy  is  defined  as  "  the  science  of 
wealtli,"  and  the  title  seems  fairly  descriptive  of  its 
purpose  except  in  the  point  that  "  riches  "  might  well 
be  substituted  for  the  last  word  of  the  definition  as 
more  correctly  expressing  the  meaning.  As  defined  by 
political  economists  "  wealth  "  is  a  term  standing  for 
all  articles  of  value,  and  "  value "  is  understood  as 
*^  power  in  exchange."  In  its  original  sense  "  wealth  " 
meant  well-being,  and  was  not  identical  in  signifi- 
cance with  "  riches."  It  has  been  found  convenient  in 
these  pages  to  return  to  the  older  meaning,  and  to 
understand  by  "  wealth  "  not  merely  a  thing  of  the 
market  place,  but  also  a  matter  of  social  conditions. 

The  ultimate  value  of  political  economy,  as  of  other 
sciences,  lies  in  its  capacity  to  serve  human  welfare, 
to  labor  for  the  free  and  happy  development  of  all 
members  of  the  body  politic,  and  where  it  limits  itself 
to  merely  studying  and  devising  machinery  for  com- 
manding markets  and  amassing  riches  it  is  but  taking 

3 


4     SOCIAL  WELFAEE  IK  NEW  ZEALAND 

steps  to  the  social  and  intellectual  degradation  of  the 
nations  that  follow  its  counsels.  A  political  economy 
with  a  somewhat  limited  conception  of  its  functions 
has  long  had  a  pretty  free  hand  among  civilised  and 
so-called  Christian  nations,  especially  nations  of  our 
own  race,  and  with  results  wholly  inconsistent  with  real 
national  well-being.  The  time  would  seem  to  have  ar- 
rived for  showing  that  there  is  a  broader,  better,  and 
higher  law  than  that  of  a  narrow  commercial  selfish- 
ness available  for  the  regulation  of  human  society; 
and  that  in  the  application  of  that  law  there  may  be 
found  the  large  measure  of  real  progress  and  general 
happiness  and  well-being  to  which  the  vast  majority  of 
our  people  have  hitherto  been  strangers.  A  glance  at 
the  social  and  economic  history  of  the  past  may  serve 
as  the  writer's  point  of  departure. 

Almost  all  our  earliest  records  —  hardly  any  of 
which  seem  to  be  seven  thousand  years  old  —  indicate 
the  existence  of  human  associations  more  or  less  re- 
sembling what  we  call  nations  to-day.  On  one  point 
they  are  all  agreed ;  they  tell  of  the  power,  riches,  and 
luxury  of  the  very  few,  in  terrible  contrast  with  the 
misery,  degradation,  and  want  of  the  vast  majority. 
But  while  in  these  earliest  records  of  human  societies 
there  is  absolutely  no  suggestion  of  well-being  for  the 
great  majority,  there  are  many  indications  of  riches 
and  luxury  at  the  disposal  of  a  small  minority.  The 
chariots  and  horses,  the  richly  robed  kings,  and  splen- 
didly armed  conquerors,  as  well  as  the  gorgeously  at- 
tired priests,  pictured  on  the  walls  of  the  palaces  of 
old   Egypt  and  Nineveh,   suggest   luxury,   more   bar- 


A  BACKWAED  GLANCE  5 

barons,  perhaps,  but  for  the  times  not  less  real  than 
tliat  of  the  millionaires  of  to-day.  The  wealth  of  those 
days  was  evidently  of  the  kind  which  our  political 
economists  would  have  us  believe  the  only  thing  worthy 
of  the  name  — "  property  of  exchangeable  value." 

As  the  records  of  the  past  come  a  little  closer  to  our 
own  times  they  become  fuller  and  more  familiar  in 
form,  but  their  real  significance  remains  unaltered. 
Whether  they  tell  the  story  of  Greece,  the  intellectual, 
of  Carthage,  the  commercial,  or  of  Rome,  the  conquer- 
ing, all  the  leading  features  of  social  conditions  remain 
practically  the  same.  At  each  stage  of  national  devel- 
opment it  is  still  in  every  case  the  very  few  who  enjoy 
what  there  is  of  wealth,  even  in  its  narrowest  and  most 
commercial  sense ;  it  is  still  the  vast  majority  who  re- 
main deprived  of  well-being  in  any  sense  whatever. 

Carthage  represents  in  ancient  history  the  most  per- 
fect example  of  the  world's  great  commercial  centre, 
very  much  as  London  or  JSTew  York  may  be  said  to  rep- 
resent it  to-day.  Her  fleets  traded  with  northern 
Europe  and  southern  Africa ;  her  merchants  speculated 
in  the  tin  mines  of  Britain,  the  lead  mines  of  Spain, 
and  the  gold  and  jewels  of  central  and  southern  Africa. 
Her  markets  were  rich  with  the  silks  of  China,  and 
the  finest  products  of  the  handicrafts  of  India.  Her 
people  acknowledged  neither  king  nor  emperor,  but 
were  proud  of  being  a  great  republic  in  which  the 
citizens  had  equal  rights.  Carthage  and  her  citizens 
had  so  far  monopolised  the  riches  known  to  the  world 
of  her  day  that  the  exchangeable  value  of  her  posses- 
sions may  never  have  been  exceeded  in  later  times  by 


6     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

that  of  any  community  of  equal  numbers.  And  with 
it  all  national  well-being  was  a  thing  unknown  save  to 
a  handful  of  her  people.  Her  merchants,  like  those  of 
America  to-day,  were  very  rich,  and  lived  in  ostenta- 
tious luxury;  the  poor,  on  the  other  hand,  were  miser- 
ably poor,  and  compared  with  the  rich  they  numbered 
hundreds  to  one. 

A  few  centuries  later  Home  had  become  the  centre 
of  power  for  the  world's  civilisation,  and  the  great 
point  of  attraction  for  the  world's  riches.  Luxury, 
even  exceeding  that  of  the  great  cities  of  to-day,  reigned 
in  the  palaces  of  her  emperors,  and  in  the  hardly  less 
palatial  homes  of  her  senators  and  knights.  The 
population  of  from  two  to  three  millions  that  gathered 
round  the  seven  hills,  and  spread  along  the  banks  of 
the  Tiber,  enclosed  the  little  band  of  the  world's  multi- 
millionaires, who  possessed  everything  that  riches  could 
give;  it  also  comprised  the  millions  of  workers,  actu- 
ally or  legally  enslaved,  who  had  next  to  nothing. 
The  romance  of  history  —  the  part  of  it  that  usually 
survives  —  has  handed  down  to  later  ages  pictures  of 
the  riches  and  luxury  of  the  few  multi-millionaires;  it 
has  said  little  or  nothing  of  the  degradation  and  op- 
pression that  were  the  share  of  the  vast  majority. 

Rome,  with  all  its  degrading  luxury,  and  all  its  pre- 
tentious power,  was  mistress  of  the  civilised  world 
when  Christianity  appeared,  with  its  new  ideals  and 
ethics.  It  began,  as  might  have  been  expected,  as  the  re- 
ligion of  the  poor  and  the  oppressed.  It  was  essentially 
revolutionary,  as  it  proclaimed  the  existence,  and  the 
paramount  claims  of  a  kingdom,  with  laws  and  rules 


A  BACKWARD  GLANCE  7 

of  its  own,  tliat  were  absolutely  opposed  to  those  by 
which  the  Roman  world  was  governed.  It  taught  the 
absolute  equality  of  all  men  in  the  highest  sense,  and 
the  absolute  responsibility  of  each  for  the  fair  and 
unselfish  use  of  whatever  they  possessed,  for  the  bene- 
fit, not  of  themselves,  but  in  the  first  place  of  others. 
It  soon  became  evident  to  the  more  intelligent  minds 
of  the  wealthy  and  ruling  class  that  it  must  be  de- 
stroyed, or  it  would  be  likely  in  the  end  to  destroy  all 
they  valued  most  in  their  social  arrangements.  A  new 
religion,  more  or  less,  had  up  to  that  time  seemed  a 
small  matter  to  the  Roman  world,  and  new  deities  and 
new  temples  had  been  multiplied  without  objection. 
These  religions  had  no  quarrel  with  existing  religions 
on  social  grounds.  The  new  Christian  religion,  how- 
ever, was  essentially  different.  It  was  not  a  religion 
of  temples,  sacrifices,  and  a  priestly  class,  but  one  of 
ideals  and  daily  practice  on  the  part  of  its  converts. 
If  these  ideals  were  generally  adopted,  and  if  this  new 
kind  of  life  became  anything  like  imiversal,  it  was  easy 
to  see  that  the  whole  fabric  of  Roman  society,  social, 
political,  and  economic,  would  be  upset,  and  the  privi- 
leges that  had  required  centuries  to  establish,  would  be 
swept  away.  The  natural  policy  was  the  suppression 
by  force  of  the  new  and  dangerous  religion ;  and  this, 
rather  than  the  opposition  of  any  rival  religions,  was 
the  true  meaning  of  the  persecutions  by  which  the 
professors  of  the  new  faith  were  assailed  at  intervals 
during  nearly  three  hundred  years. 

The  attempt  to  meet  the  danger  with  which  Chris- 
tianity  threatened   the   accepted   social   and   economic 


8     SOCIAL  WELFAKE  IN  NEW  ZEALAM) 

ideas  of  the  time  hj  violence  was  neither  readily  nor 
quickly  abandoned.  Persecutions  broke  out  again  and 
again  in  nearly  every  part  of  the  Koman  Empire  dur- 
ing two  hundred  years  and  more,  and  it  was  only  the 
absolute  conviction  of  its  useiessness,  and  an  increasing 
suspicion  of  its  danger  that  in  the  end  caused  the  at- 
tempt to  be  abandoned.  Little  by  little  the  new  reli- 
gion had  conquered ;  but  in  conquering  it  had  suffered  a 
defeat. 

The  new  classes  that  had  gradually  attached  tbem- 
selves  to  Christianity  consisted  very  largely  of  those 
who  had  had  experience  of  social  well-being.  To 
them  the  laws  of  the  kingdom,  literally  interpreted, 
certainly  did  not  appeal.  It  could  never  —  tbey  very 
naturally  argued  —  have  been  meant  that  in  a  reformed 
world  there  was  to  be  no  distinction  of  classes.  It 
could  not  be  supposed  that  kings,  nobles,  and  high 
priests,  with  their  magnificent  robes  and  costly  orna- 
ments, were  to  be  forbidden,  and  that  all  the  riches  of 
the  upper  classes  were  to  be  looked  on  merely  as  trust- 
money,  placed  in  their  hands  for  the  use  of  others. 
That  kind  of  thing  might  be  all  very  well  for  the  very 
poor,  or  for  slaves,  but  it  was  evidently  impossible  for 
a  civilised  and  progressive  society,  in  which  some  had 
capital  and  others  none  —  some  had  ability,  while 
others  were  common  drudges  —  some  were  meant  for 
leaders,  and  others  could  never  be  more  than  followers 
at  the  very  best. 

This,  and  considerations  such  as  these,  had  probably 
been  the  most  formidable  obstacles  in  the  way  of  the 
acceptance  of  the  new  faith  for  three  hundred  years, 


A  BACKWAED  GLAKCE  9 

but  at  last  the  difficulty  was  got  rid  of  by  a  device  by 
no  means  new,  yet  perhaps  never  before  or  since  ap- 
pKed  with  so  much  success.  Somebody  discovered  that 
the  early  teachers  of  Christianity  had  been  entirely 
mistaken  in  their  interpretation  of  the  laws  of  the 
Kingdom,  which  had  really  no  such  meaning  as  had 
been  supposed.  As  a  matter  of  fact  they  were  in  no 
way  opposed  to  the  habits  of  the  society,  that  pre- 
supposed great  riches,  and  even  luxury  for  a  small  class, 
and  great  —  or  at  any  rate  very  considerable  poverty  — 
for  a  very  large  class.  On  the  contrary  these  were  di- 
vine institutions,  and  it  was  the  clear  duty  of  every 
Christian  to  recognise  and  support  them  on  religious 
as  well  as  social  grounds. 

The  new  discovery  removed  the  chief  difficulty  in 
the  way  of  the  acceptance  of  Christianity  by  the  influ- 
ential classes  of  the  Roman  Empire.  Christianity  had 
been  opposed,  rejected,  and  persecuted,  largely  because 
it  had  appeared  impossible  to  reconcile  it  with  the  social 
customs  that  had  so  long  divided  the  little  classes  of 
the  rich  and  fortunate  from  the  great  classes  of  the 
poor  and  oppressed ;  they  were  willing  to  accept  it  — 
as  far  at  least  as  outward  observances  went, —  if  it 
could  be  done  without  upsetting  these  distinctions.  In 
effect  the  compromise  was  accepted.  When  the  Chris- 
tian Church  became  the  church  of  the  empire,  its  teach- 
ers and  its  people  for  the  most  part  adopted  the  ideas 
and  customs  of  the  empire.  The  emperors,  the  nobles, 
and  the  wealthy  gave  up  a  few  customs,  and  adopted 
a  few  others ;  but  on  the  whole  the  main  features  of  so- 
ciety were  but  little  changed.     The  ostentation  of  the 


10     SOCIAL  WELPAEE  IN  NEW  ZEALAND 

great  was  as  ostentatious  as  before;  the  prodigal  ex- 
penditure of  the  rich  on  themselves,  or  on  objects  that 
did  not  benefit  their  poorer  neighbours,  had  undergone 
no  general  alteration.  The  Church  itself,  with  its 
patriarchs,  archbishops,  and  bishops,  had  little  or  no  re- 
semblance to  the  Church  founded  bj  the  band  of  Gali- 
lean fishermen,  but  a  very  striking  resemblance  to  the 
gorgeously  bedizened  priesthood  of  the  old  heathen  dei- 
ties. The  poor,  the  oppressed,  and  the  slaves,  were 
still  oppressed  and  poor;  but  now  they  were  taught  to 
believe  that  they  were  part  of  God's  plan  of  society, 
against  which  it  was  wicked  and  presumptuous  to 
rebel. 

The  story  of  the  great  religious  compromise,  com- 
pleted in  the  time  of  the  Emperor  Constantino,  con- 
tains the  key-note  of  the  social  conditions  of  Europe 
in  what  we  call  the  Middle  Ages.  The  real  link  be- 
tween the  Roman  period  and  the  Middle  Ages  is  not  to 
be  found  in  the  transfer  of  the  civilisation  of  the  Em- 
pire to  the  races  that  tore  it  to  pieces ;  because  in  fact 
the  civilisation  of  Kome,  such  as  it  was,  was  not  handed 
on,  and  had  but  little  influence  on  the  new  nations 
that  divided  the  Empire  among  them.  The  only  thing 
Eome  really  passed  on  was  the  religion  it  had  accepted 
as  a  State,  but  which  it  had  never  adopted  in  anything 
approaching  its  original  form,  and  still  less,  perhaps, 
its  original  spirit.  The  Christianity  of  the  Middle 
Ages,  like  that  of  the  later  Roman  Empire,  was  essen- 
tially the  religion  of  compromise;  a  religion  that  had 
no  message  for  nations,  as  such,  but  practically  for  in- 
dividuals only. 


A  BACKWARD  GLAiN-QE  11 

The  social  aspects  of  the  Middle  Ages  are  tolerably 
familiar  to  manj  readers  both  of  history  and  fiction 
at  this  time.  They  form  an  interesting  story  of  evo- 
lution, very  gradual  in  accomplishment,  and  very  im- 
perfect in  its  results  —  yet,  after  all,  a  real  evolution. 
In  this  process  Christianity  was  probably  the  leading 
factor,  though  it  had  been  deprived  of  its  chief  and 
most  characteristic  social  features.  Instead  of  being, 
as  it  had  originally  been,  the  faith  of  the  poor  and 
wretched  multitude,  offering  them  help  and  comfort  in 
their  present  sufferings,  it  had  become  the  religion  of 
the  rich  and  powerful  —  of  kings  and  nobles,  rich  eccle- 
siastics, and  heartless  oppressors,  who  readily  admitted 
that  in  some  future  state  of  being  —  though  certainly 
not  on  earth  —  they  might  hope  for  a  better  fate  than 
had  befallen  them  here. 

The  feudal  system,  on  which  the  social  system  of  the 
Middle  Ages  was  founded,  was  the  almost  inevitable  re- 
sult of  a  period  of  savage  war  and  conquest,  in  which 
savage  tribes  overran  and  subdued  countries  and  com- 
munities more  civilised  than  themselves,  but,  owing 
mainly  to  their  corrupt  social  and  political  conditions, 
too  feeble  to  resist  them.  It  was  the  strongest  and 
most  daring  man  that  under  such  circumstances  took 
the  lead,  and,  when  the  conquest  was  won,  seized  the 
spoils.  The  nobles  of  the  new  kingdoms  of  Europe, 
like  the  leaders  of  the  Cave  men,  were  only  the  strongest 
savages,  who  claimed  the  admiration  of  their  compan- 
ions for  their  strength,  and  gave  them  back  leadership, 
and  comparative  safety  in  return.  The  feudal  system 
really  meant,  economically,  no  more  than  this.     In  the 


12     SOCIAL  WELFAEE  IK  NEW  ZEALAND 

countries  they  came  from  agriculture  had  scarcely  ex- 
isted, and  land  for  its  own  sake  had  been  of  little  value; 
so  it  had  practically  belonged  to  all  the  tribe  that  lived 
and  hunted  there.  In  the  newly  conquered  lands  the 
soil  was  cultivated  by  people  who  lived  on  the  land,  and 
were  generally  as  ready  to  submit  to  new  masters,  and 
share  with  them  what  the  land  produced,  as  they  had 
been  with  their  old  masters. 

The  next  step  on  the  path  of  social  evolution  came 
gradually.  The  rise  of  a  commercial  period  in  Europe 
was  necessarily  slow;  but,  once  begun,  it  went  steadily 
forward.  Eor  many  centuries  the  qualities  that  con- 
stitute mental  power  and  superiority,  along  with  the 
class  that  chiefly  possessed  them,  had  been  dedicated 
in  Europe,  as  they  had  been  during  long  ages  previous 
in  the  countries  of  the  East,  to  the  service  of  religion. 
Little  by  little,  with  the  coming  of  times  less  troubled, 
handicrafts,  trades,  and  commerce  claimed  a  steadily 
increasing  share  of  the  more  intelligent  minds.  One 
great  secret  of  this  development  among  peoples  of 
European  origin,  and  the  one  that  has  distinguished 
their  experience  from  that  of  the  older  peoples  of 
Asia,  was  the  discovery  that  by  combination  they 
could  provide  for  themselves  the  safety  and  protection 
for  which  they  had  formerly  looked  to  another  class. 
It  was  on  this  discovery  that  the  idea  of  the  modem 
city  was  founded.  The  new  idea  was  the  beginning  of 
a  social  revolution,  the  greatest,  perhaps,  that  the  world 
had  seen.  Liberty  —  the  freedom  of  mankind  to  work 
out  the  problem  of  their  own  well-being  in  the  light  of 
their  own  experience  —  was  an  idea  so  new  to  mankind 


A  BACKWARD  GLAXCE  13 

that  it  could  only  be  approached  by  gradual  steps;  it 
was,  however,  the  idea  that  gave  life  and  reality  to  the 
rise  of  the  trading  and  industrial  cities  of  Europe. 

The  change  from  the  old  era  of  violence,  with  its 
small  class  of  warriors,  with  their  virtues  of  honour 
and  generosity  on  the  one  hand,  and  their  vices  of 
pride  and  selfish  arrogance  on  the  other,  to  the  new 
one,  in  which  freedom  was  more  widely  recognised, 
was,  as  has  been  said,  a  slow  one,  extending  over 
hundreds  of  years  even  in  England,  where  it  was 
most  rapid  and  most  complete.  In  every  case,  too,  the 
change  was  one  of  limited  application.  Eor  the  mer- 
chant and  the  skilled  artisan  in  cities  the  new  era  was 
one  of  greatly  increased  well-being  in  nearly  every  way 
— '  it  had  done  little  or  nothing  for  the  unskilled  worker 
and  the  field  labourer  in  any  European  country.  What 
had  happened  was  little  more  than  the  creation  of  a 
new  class,  larger,  indeed,  and  less  exclusive  than  the 
old  one  of  the  nobility,  to  which  many  of  the  essential  el- 
ements of  human  well-being  were  becoming  familiar,  as 
they  had  so  long  been  to  the  nobles.  This  new  class, 
however,  after  all,  formed  but  a  small  percentage  of  the 
people.  It  was  still  as  before  the  well-being  of  the 
few  that  was  secured,  or  even  considered  —  that  of 
the  many  was  almost  totally  disregarded.  Such,  it 
may  fairly  be  said,  was  the  result  of  something  like 
twelve  hundred  years  of  more  or  less  conscious  struggle 
after  better  social  conditions  in  Europe,  from  the  break- 
ing up  of  the  Eoman  Empire  to  the  end  of  the  eight- 
eenth century  of  the  Christian  era. 


CHAPTER  II 

THE  AGE  OF  COMMEECIALISM 

OuB  brief  glance  at  the  past  history  of  nations 
stopped  at  the  close  of  the  eighteenth  century,  a  period 
which  coincides  with  the  end  of  one  great  period  in 
the  civilisation  of  the  western  world  and  the  beginning 
of  another.  The  American  revolution  with  its  story  of 
heroic  effort  crowned  by  success  was  only  one  in- 
dication of  the  temper  of  the  new  era  that  had  just  be- 
gim,  as  the  French  Eevolution,  with  all  its  terrors,  was 
another.  The  world  was  awakening  to  a  new  age  — 
an  age  in  which  the  energies  of  men  were  to  take  a  new 
direction,  the  discoveries  of  men  were  to  find  a  new  ex- 
pansion, the  knowledge  of  men  a  hundred  new  avenues 
to  usefulness  and  development.  And  that  awakening 
was  largely  due  to  the  discovery  of  steam  as  a  motive 
power.  The  new  discovery  produced  a  revolution  in 
matters  political,  social,  and  economic,  within  a  single 
generation  such  as  no  period  of  a  thousand  years  had 
ever  produced  before. 

The  new  age  has  been  called  the  "  age  of  commer- 
cialism," and  so  far  the  name  appears  singularly  ap- 
propriate. Commerce,  which  in  reality  means  nothing 
more  than  exchange,  is  certainly  one  of  the  oldest  in- 
stincts of  humanity.     It  began,  no  doubt,  when  first 

14 


THE  AGE  OF  COMMERCIALISM         15 

it  dawned  on  the  mind  of  primeval  man  that  it  was 
better  to  exchange  something  he  had,  but  did  not  need, 
for  something  his  neighbour  possessed,  than  to  try  to 
take  it  by  force,  especially  where  a  resort  to  force  meant 
possible  defeat.  There  were,  of  course,  no  nations, 
hardly  anything  that  we  should  call  a  community  then, 
so  that  the  earliest  kind  of  commerce  must  have  been 
entirely  personal.  Simple  and  primeval  as  it  was  in 
form,  the  principle  was  the  same  as  that  on  which  a 
world-wide  commerce  rests  to-day.  It  was  not,  how- 
ever, till  it  dawned  on  the  collective  intelligence  of  na- 
tions as  it  had  so  long  before  dawned  on  that  of  indi- 
viduals, that  it  was  less  difficult,  and  in  many  ways 
less  costly,  to  get  what  they  wanted  from  their  neigh- 
bours by  peaceable  exchange  than  by  war,  that  the  earli- 
est era  of  international  commerce  began.  Its  progress 
was  slow.  Many  things  had  to  be  learned,  many  preju- 
dices to  be  overcome,  and  many  wants  to  be  discov- 
ered, before  nations  learned  the  great  economic  truth 
that  nature  has  endowed  almost  every  portion  of  the 
habitable  world  with  some  speciality  of  its  o^vn  —  that 
every  nation  has  therefore  something  it  can  offer  to 
other  nations  in  exchange  for  their  own  products. 

In  this  way  the  civilised  world  was  gradually  pre- 
pared for  the  coming  of  an  age  in  which  commerce 
should  be  free  and  imiversal.  The  discovery  made  by 
Watt,  and  its  later  practical  applications,  gave  the  im- 
pulse that  was  needed  to  usher  in  an  era  of  interna- 
tional commerce  such  as  the  world  had  never  dreamed 
of  before.  The  nineteenth  century  was  the  first  to 
enjoy  the  new  aids  to  production  and  distribution,  and 


16     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

consequently  it  has  been  the  great  revolutionary  period 
in  the  history  of  industrial  humanity.  Like  all  periods 
of  revolution  recorded  in  history  it  has  developed  many 
features  both  of  good  and  evil.  It  has  called  into  be- 
ing new  energies  and  a  keener  intelligence  in  the  work- 
ers; and  it  has  also  supplied  many  material  helps  to 
well-being  that  should  be  available  for  society  in  gen- 
eral. It  has  opened  up  a  thousand  new  channels  for  the 
profitable  employment  of  capital  in  industrial  enter- 
prises ;  and  in  doing  this  it  has  opened  up  new  fields  for 
the  employment  of  skilled  labour,  and  incidentally  de- 
manded more  education  on  the  part  of  a  large  percent- 
age of  the  workers.  In  these  respects  the  conditions  of 
the  new  era  have  been  improved,  as  compared  mth  any 
that  went  before  it.  There  is,  however,  another  side  to 
the  picture. 

The  revolution  in  the  conditions  of  industrial  pro- 
duction was  first  appreciated  by  the  owners  of  capital 
and  employers  of  labour,  and,  as  was  perhaps  natural, 
they  welcomed  it  as  something  belonging  to  themselves 
—  something  with  which  the  workers  had  little  or  noth- 
ing to  do.  During  the  first  half  of  the  nineteenth  cen- 
tury this  claim  of  the  capitalists  to  monopolise  the  prof- 
its arising  from  the  new  aids  to  extended  industrial  en- 
terprise were  almost  unquestioned.  To  the  capitalist 
class  itself  the  rights  of  the  matter  seemed  beyond  the 
reach  of  argument,  indeed.  Did  not  they  find  the 
money,  without  which  the  new  machinery  could  not 
be  made;  did  not  they  open  up  new  markets  by  their 
enterprise ;  was  it  not  their  capital  that  was  risked,  and 
might  be  lost,  in  the  new  enterprises  of  all  kinds  that 


THE  AGE  OF  COMMEECIALISM         17 

found  employment  for  so  many  workers?  And  for  a 
time  the  assumption  underlying  tiie  capitalist's  argu- 
ment, that  they  did  everything,  and  gave  everything 
that  went  to  the  expansion  of  the  new  commerce,  was 
hardly  denied.  The  age  of  the  factory  and  the  mill 
had  succeeded  that  of  the  old  cottage  loom  and  the 
workshop;  the  population  was  being  dra^wn  into  cities 
where  the  conditions  for  the  workers  and  their  families 
were  worse  than  in  the  older  days;  but  it  was  true 
that  the  capitalist  built  the  factories,  and  paid  the 
wages;  and  it  was  not  for  some  time  that  the  workers 
began  seriously  to  question  the  assumptions  of  the  em- 
ployers. 

It  had  not  come  home  to  the  minds  of  the  capitalists 
that  the  new  conditions  that  favoured  them  in  their 
pursuit  of  riches  as  never  before  carried  with  them 
dangers  to  their  supremacy  such  as  had  not  before  ex- 
isted. And  yet  this  was  the  case,  so  unquestionably 
that,  looking  back,  it  appears  strange  it  should  not  have 
been  foreseen.  Two  things  had  united  to  advance  the 
new  conditions  from  the  point  of  view  of  the  capitalists ; 
one,  the  accumulation  of  more  money  than  ever  before 
in  the  hands  of  a  trading  class,  which  made  it  possible 
to  meet  the  demand  for  new  capital  to  be  invested  in 
the  nevv''  industries;  the  other,  the  rapidly  increas- 
ing intelligence  and  mechanical  efficiency  of  the  work- 
ers. What  had  not  been  foreseen  by  them  was,  in  the 
first  place,  that  with  increased  intelligence  there  would 
come  to  the  class  of  the  workers  new  ideas,  and  new  re- 
quirements of  many  kinds ;  and  in  the  second,  that  as 
the  new  conditions  called  for  organised  labour,  it  was 


18     SOCIAL  WELFAEE  II!^  I^EW  ZEALAND 

certain  the  habit  of  organising  would  spread  in  other 
directions. 

The  point  of  view  of  the  workers  can  readily  be  un- 
derstood. They  saw  that  the  new  conditions  were  pour- 
ing vastly  increased  riches  into  the  hands  of  those  who 
seemed  too  rich  already;  they  saw  that  their  own  class 
was  no  better  off  under  the  new  conditions  than  it  had 
been  under  the  old,  but,  on  the  contrary,  in  some  re- 
spects, the  reverse.  They  saw,  too,  that  the  increased 
profits  of  industry  were  not  brought  about  by  steam 
and  machinery  alone.  It  was  the  result  of  their  la- 
bour, and  of  their  organised  effort,  without  which 
steam  engines  and  machinery  were  useless.  The  con- 
clusion was  natural  —  they  had  a  just  claim  to  their 
share  of  the  increase  of  wealth  which  could  not  be 
produced  without  their  aid.  But  how  could  the  work- 
ers secure  their  share  ?  The  experience  of  what  had 
been  accomplished  by  associated  labour  after  a  time 
suggested  an  answer.  If  co-operation  in  work  could 
do  so  much  for  the  employers,  was  it  not  at  least  pos- 
sible that  co-operation  in  refusing  to  work  might  se- 
cure much  to  the  workmen  ?  This,  if  not  the  expressed, 
was  the  real  basis  on  which  the  Trade  Union  was 
founded,  and  perhaps  the  only  one  on  which  it  could 
have  been  established  successfully. 

The  capitalists  foresaw  that  the  new  movement 
meant  war.  If  there  was  to  be  a  struggle,  the  weapons 
of  the  Unions  would  be  more  or  less  the  weapons  of 
force ;  it  was  a  natural  suggestion  that  their  best  capital- 
istic resource  might  lie  in  cunning.  To  this  conclu- 
sion—  not  perhaps  definitely,  but  none  the  less  really 


THE  AGE  OF  COMMERCIALISM  19 

—  has  been  due  the  development  in  its  various  forms 
of  the  new  policy  of  Capital  which  has  been  so  widely 
accepted,  and  so  generally  approved  as  "  commercial- 
ism." 

The  representatives  of  capital  saw,  however,  that 
while  they  might  in  a  majority  of  cases  be  successful 
in  refusing  to  comply  with  the  demands  of  the  workers 
for  higher  wages  and  less  work,  they  could  only  do  so 
at  a  great  sacrifice  of  money.  They  therefore  sought 
some  cheaper  way  of  appropriating  the  lion's  share  of 
the  profits.  Higher  wages  meant  only  a  little  more 
cost  of  production ;  shorter  hours  only  a  little  less  pro- 
duced. It  would  pay  to  grant  some  of  the  demands 
of  labour  on  the  one  hand,  and  to  increase  the  price  of 
everything  the  workers  needed  for  themselves  and  fami- 
lies on  the  other.  This  was  in  effect  a  cheat,  but  at 
least  it  afforded  an  almost  infinite  variety  of  new  in- 
terests and  new  opportunities  to  clever  men  who  were 
untroubled  by  conscientious  scruples.  The  procedure 
could  be  easily  concealed  under  the  name  of  business 
or  the  high-sounding  title  of  "  Commercialism,"  which 
has  meant  simply  the  increase  of  the  concentrated  self- 
ishness which  seeks  to  gain  riches,  power,  and  influ- 
ence without  regard  for  the  good  of  the  community. 
The  reign  of  commercialism  has  indeed  been  coinci- 
dent with  higher  wages  and  salaries  in  every  country 
in  which  that  reign  has  prevailed,  but  it  has  not,  except 
in  appearance,  really  benefited  the  classes  that  needed 
it  the  most.  If  wages  have  been  raised,  so,  in  a 
substantially  greater  proportion,  have  the  prices  of  the 
goods  produced  by  the  earners  of  wages.     If  the  sal- 


20     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

aries  of  employes  in  oflBces  and  stores  have  been  in- 
creased, rents  of  dwellings  owned  by  the  capitalists, 
as  well  as  the  prices  of  everything  that  constitutes 
well-being,  have  risen  in  a  still  greater  proportion. 
Commercialism  has  introduced  and  defended  by  every 
illegal  and  selfish  device  the  combinations  in  restraint 
of  trade,  whose  objects  have  always  been  said  to  be  the 
good  of  the  public,  but  whose  actual  results  have  been 
the  increasing  enrichment  of  those  who  combined,  and 
increased  cost  of  living,  with,  usually,  deteriorating 
products,  for  the  rest  of  the  community. 

There  are  few  ideas  more  popular,  especially  in 
America,  to-day  than  that  of  personal  ambition.  The 
parents  of  America,  and  to  a  real,  though  perhaps  a  less 
extent,  those  of  England,  of  Germany,  and  France,  are 
ambitious  for  what  they  look  on  as  the  success  in  life  of 
their  sons.  They  teach  ambition  —  how  to  succeed, 
not  in  character,  not  in  usefulness,  but  in  riches,  in  in- 
fluence, in  station  —  in  all  that  these  things  can  give 
them  of  greater  consideration.  And  this  is  commer- 
cialism in  the  social  atmosphere,  more  insidious,  per- 
haps even  more  poisonous  in  its  effect  on  the  future  of 
society,  than  the  most  gigantic  frauds  that  are  encour- 
aged by  the  morals  of  the  stock  market. 

It  may  be  said  that  we  exaggerate  in  maintaining 
that  the  commercial  spirit  of  the  civilised  world  to-day 
is  as  selfish,  and  as  much  opposed  to  the  well-being  of 
society,  as  that  of  the  more  frankly  barbarous  and  in- 
humane ages  of  the  past.  We  may  be  told  of  the  hos- 
pitals that  have  been  endowed,  the  colleges  that  have 
been  founded,  the  churches  that  have  been  built  in  ev- 


THE  AGE  OF  COMMEECIALISM         21 

erf  city  and  town.  We  may  even  be  asked  to  believe 
that  the  large  gifts,  made  out  of  the  surplus  profits  of 
commercial  undertakings,  many  of  which  have  been  dis- 
honest, and  all  of  which  have  taken  from  the  people 
much  to  which  the  people  were  entitled,  constitute  a 
defence  for  the  commercial  spirit  and  methods  of  the 
age. 


CHAPTEE  III 

THE   FRUITS   OF  COMMERCIALISM 

HuMAisr  civilisation  lias  been  described  as  a  process 
of  gradually  increasing  commercialism,  of  which  the 
present  age  claims  to  have  attained  the  highest  de- 
velopment. From  the  earliest  times  of  which  any  rec- 
ord remains,  civilisation  and  the  commercial  spirit  — 
in  other  words,  the  spirit  of  individual  aggrandisement, 
or  selfishness, — ^have,  it  is  said,  advanced  side  by  side. 
It  may  be  useful,  as  well  as  interesting,  to  pause  for  a 
few  moments  and  consider  what  it  has  done  for  the 
well-being  of  mankind  —  how  far  it  has  yet  led  the 
mass  of  men  on  the  way  to  even  a  material  well-being. 
If  it  is  true,  as  there  seems  little  reason  to  doubt,  that 
the  twentieth  century  displays  the  spirit  of  the  market 
place  more  than  any  that  Avent  before  it;  and  if  the 
United  States  is  in  many  ways  its  most  perfect  repre- 
sentative, we  may  confine  our  attention  mainly  to  the 
last  fifty  years'  progress,  social,  industrial,  and  polit- 
ical in  America. 

At  the  close  of  the  first  ten  years  of  the  twentieth 
century  the  great  American  Republic  could  boast  of 
being  not  only  the  largest  and  most  populous  country 
living  under  republican  institutions,  but  also  of  being 
the  most  progressive  community  of  the  world's  pro- 

22 


THE  FRUITS  OF  COMMERCIALISM     23 

ducers.  It  could  be  said  that  its  people  were  not  only 
free  and  self-governing,  but  that  they  were  also  increas- 
ing more  rapidly  than  any  other  nation  in  riches. 
Fifty  years  ago  the  goods  of  every  kind  exported  from 
America  were  valued  at  rather  more  than  three  bunded 
million  dollars  in  a  year,  and  this  was  the  result  of  the 
exertions  of  fully  thirty-eight  million  inhabitants;  last 
year  the  goods  exported  were  valued  at  fully  two  bil- 
lion dollars,  nearly  seven  times  as  much,  while  the  pop- 
ulation still  fell  considerably  short  of  three  times  what 
it  had  been  fifty  years  before.  The  meaning  of  this  is, 
not  only  that  the  numbers  of  the  people  have  increased 
more  than  two  and  a  half  times  within  fifty  years,  but 
that  they  have  been  able  to  produce  goods  that  brought 
into  the  country  from  the  markets  of  the  outside  world 
either  goods  or  money  in  exchange  more  than  twenty 
dollars  per  head  of  the  people,  instead  of  eight  dollars, 
which  was  the  limit  fifty  years  ago.  This  record  is  one 
that  is  calculated  to  lead  the  casual  observer  to  accept 
the  optimistic  views  of  those  who  congratulate  their 
country  on  the  present  reign  of  acute  commercialism 
as  that  which  leads  to  national  well-being. 

There  is  an  old  Hebrew  chronicle  with  which  most 
readers  of  this  book  are,  no  doubt,  familiar,  which 
deals  with  the  early  history  of  Egypt.  The  story  tells 
of  a  wide-spread  famine  following  on  years  of  unusual 
plenty.  During  the  years  of  plenty  the  Pharaoh  col- 
lected the  country's  surplus  supply  of  food,  which  he 
stored  up  against  the  years  of  famine  which  he  foresaw. 
When  those  years  came  the  exchangeable  wealth  of  the 
people  of  Egypt  was  practically  all  in  the  hands  of  the 


24:     SOCIAL  WELFAEE  m  NEW  ZEALAND 

king.  That  wealth  was  enormous;  for  not  only  Egypt 
but  the  surrounding  countries  suffered  from  the  fam- 
ine, while  he  alone  was  possessed  of  the  necessaiy  food. 
The  riches  of  the  surrounding  countries  poured  into 
Egypt,  undoubtedly,  but  it  was  not  the  people  of  Egypt 
that  obtained  the  wealth.  They  were  poorer  than  ever 
before.  In  the  case  of  Egypt  four  thousand  years  ago, 
it  was  the  king  who  grew  rich,  and  became  the  multi- 
millionaire; to-day,  it  is  a  little  class  of  men  who,  by 
following  a  similar  policy,  have  become  the  multi-mil- 
lionaires of  America. 

In  the  case  of  the  class  of  great  American  capitalists 
it  may  be  said  that  the  result  of  their  operations  has  not 
been  essentially  different  from  that  of  Egypt  thirty- 
eight  centuries  ago.  Their  class  has  done  great  things, 
it  may  be  admitted,  for  the  development  of  the  country. 
They  have  covered  it  with  railroads,  as  Pharaoh  seamed 
the  Egyptian  delta  with  canals,  making  settlement  pos- 
sible, where  it  would  hardly  have  been  possible  with- 
out them;  and  in  so  doing  they  seized  the  opportunity 
of  grasping  vast  territories  of  the  people's  land.  They 
have  started  a  thousand  new  industries,  and  by  their 
means  have  given  employment  to  some  millions  of  work- 
ers. But  have  they  added  substantially  to  the  well- 
being  of  those  employed?  Should  we  go  for  an  an- 
swer to  the  mine  workers  of  Pennsylvania,  the  sewing 
women  and  girls  of  New  York,  the  stockyard  hands  of 
Chicago,  or  the  children  employed  in  the  cotton  mills 
of  the  Southern  States  ? 

Certainly  a  very  little  inquiry  into  the  conditions 
of  the  masses  in  any  great  centre  of  population  in 


THE  FEUITS  OF  COMMEKCIALISM     25 

America,  or  indeed  in  England,  Germany,  or  Erance, 
to-day  will  demonstrate  the  economic  truth  that  it  is 
easy  for  a  nation  in  this  twentieth  centuiy  to  be  great 
in  resources  and  in  their  development,  and  to  leave  the 
overwhelming  majority  of  citizens  poor  indeed  in  all 
that  constitutes  human  well-being. 

It  may  be  said  that  the  conditions  of  the  masses  in 
America,  and  in  the  more  advanced  European  coun- 
tries, are  greatly  superior  to  those  that  prevailed  in 
Egypt  under  the  Pharaohs.  The  people  of  America 
and  England  have  at  least  political  freedom,  and  the 
privilege  of  self-government;  they  have  systems  of  ed- 
ucation, authorised  by  law,  which  give  better  oppor- 
timity  to  the  young  by  developing  natural  ability. 
The  masses  of  the  people  themselves  have,  as  a  conse- 
quence, organised  and  wrested  many  concessions  from 
the  small  class  of  capitalists  in  the  direction  of  better 
conditions  of  labour  and  higher  wages  than  were  en- 
joyed by  former  generations.  All  this  may  be  true, 
though  most  of  it  has  not  come  from  the  good-will  of 
the  little  class  which  in  America  and  elsewhere  emu- 
lates the  policy  of  Pharaoh.  The  great  truth,  how- 
ever, is  that  legislation  and  the  incorporated  "  Phara- 
ohs "  of  modem  commercialism  fall  immeasurably  short 
of  what  justice  and  a  high  conception  of  national  well- 
being  demand. 

In  America,  at  least,  an  answer  may  be  found  to 
such  an  indictment  as  this  by  the  familiar  reference 
to  the  wonderful  liberality  of  the  "  Pharaoh  Corpora- 
tion." If  these  men  amass  great  fortunes,  it  may  be 
said,   they  exercise  great  liberality,   witness  endowed 


26     SOCIAL  WELFARE  IK  NEW  ZEALAND 

universities,  hospitals,  museums,  etc.  But  tlie  mass  of 
the  American  people  are  not  satisfied  with  this  answer. 
They  want  their  share  of  the  fruits  of  their  labours  to 
use  as  they  choose.  They  do  not  want  to  be  the  bene- 
ficiaries of  those  who  take  from  them  the  wealth  they 
have  largely  created.  Universities,  and  hospitals,  and 
museums  are  good  things,  but  first  of  all  they  demand 
for  themselves  a  decent  material  basis  of  existence,  and 
then,  when  it  comes  to  establishing  institutions,  they 
would  attend  to  these  matters  themselves  and  not  re- 
ceive them  as  a  dole  from  the  wealth  that  should  have 
been  in  great  part  their  own. 

The  question  of  the  effect  of  the  accumulation  of 
wealth  on  the  class  possessing  it  also  demands  atten- 
tion. This  becomes  the  more  necessary  owing  to  the 
great,  and  still  increasing,  influence  which  this  class 
exercises  on  the  condition  of  the  people  at  large,  both 
socially  and  politically.  At  the  present  time  the  ex- 
changeable wealth  of  America  —  known  in  the  ordi- 
nary language  of  commerce  as  capital  —  is  concentra- 
ted in  the  hands  of  a  very  small  class.  This  ac- 
cumulation of  riches  in  a  few  hands  has  led  to  the  ex- 
cessive increase  of  luxury.  Babylon,  Carthage,  Eome, 
and  other  nations  have  had  this  experience,  and  how- 
ever much  the  peoples,  their  circumstances  and  tradi- 
tions may  have  differed,  they  have  all  agreed  in  one  con- 
clusion at  least:  —  The  first  result  of  the  great  indi- 
vidual riches  is  the  development  of  excessive  luxury; 
the  second  is  the  rapid  deterioration  of  the  class  pos- 
sessed of  the  riches;  the  third,  the  degradation  of  the 
whole  nation  to  which  they  belong.     At  first  it  may 


THE  FEUITS  OF  COMMEECIALISM     27 

appear  strange  that  tlie  luxury  which  directly  affects 
only  a  small  class  should  always  have  produced  effects 
so  injurious  to  the  whole  people;  a  glance  backwards 
at  the  history  of  American  experience  during  the  last 
forty-five  years  may  help  to  throw  some  light  on  the 
apparent  anomaly.  At  that  time  America  was  begin- 
ning to  recover  from  the  terrible  effects  of  the  Civil 
War,  in  which  much  of  the  country  had  been  desolated, 
and  a  large  part  of  its  wealth  sacrificed  to  preserve 
its  unity.  In  spite  of  losses  that  might  have  been  ex- 
pected to  leave  any  country  prostrate  for  many  years, 
America  had  arisen  to  the  occasion  with  a  rapidity 
that  was  marvellous,  so  that  even  within  five  years  she 
appeared  to  have  recovered  most  of  the  ground  she  had 
lost.  ISTew  population  was  pouring  into  the  country 
to  replace  that  which  had  perished;  new  enterprises 
had  already  been  set  on  foot  on  every  side,  and  a  new 
and  even  more  substantial  prosperity  seemed  to  be 
dawning. 

There  was  one  result,  however,  which  the  great  war 
had  left,  a  result  perhaps  more  serious  than  any  other : 
it  had  begun  the  creation  of  a  small  class  of  million- 
aires. Before  the  war  there  had,  of  course,  been  the 
classes  of  the  well-to-do  and  those  who  had  less  of  well- 
being,  outside  the  class  of  slaves,  in  America  as  else- 
where, but  the  distinction  had  not  been  marked  by  any 
sharp  dividing  line,  excepting  perhaps  in  the  slave 
States.  America  was  still  a  land  of  country  settle- 
ment ;  its  people  were,  for  the  most  part,  lovers  of  the 
free,  healthy,  self-respecting  life  of  farmers.  There 
were  cities,  of  course,  but  notiiing  that  even  suggested 


28      SOCIAL  WELFAEE  IK  NEW  ZEALAND 

tlie  great  American  cities  of  to-day:  manufactures  were 
carried  on  to  supply  the  needs  of  the  people,  but  the 
manufacturing  city  of  to-day,  with  its  thousand  abomi- 
nations, hardly  existed  then  in  America,  nor  was 
dreamed  of  by  its  people. 

Americans  are  wont  to  speak  of  the  burdens  the  Civil 
War  threw  on  the  country  and  of  the  losses  it  entailed, 
but  among  the  losses  it  has  not  been  usual  to  reckon 
that  of  the  simple  and  natural  life  of  a  people  content 
to  live  as  their  fathers  had  lived,  and  to  develop  their 
country  by  living  and  working  on  the  land,  as  their 
fathers  had  done.  It  has  not  occurred  to  them  that 
the  greatest  burden  of  all  left  by  the  war  was  the  crea- 
tion of  a  millionaire  class,  and  the  consequent  introduc- 
tion of  new  and  debased  ideals  of  well-being,  and  the 
thousand  evils,  social,  political,  and  national,  that  have 
sprung  from  it.  It  need  hardly  be  pointed  out  that 
the  new  class,  and  with  it  the  new  ideals,  took  their  rise 
at  the  time  of  the  Civil  War.  It  was  from  the  needs  of 
a  nation  in  the  bitter  throes  of  a  life  or  death  struggle 
that  the  millions  were  wrung  that  went  to  found  the 
new  class,  and  naturally  to  spread  the  new  ideals.  It 
was  the  great  contractors  who  secured,  or  who  seemed 
to  themselves  to  have  secured,  the  profits  of  the  war, 
and  who,  when  the  struggle  was  over,  found  the  capital 
required  to  set  on  foot  the  new  enterprises  that  have 
been  thought  of  as  the  salvation  of  the  country.  It 
would  be  unjust  to  hold  these  men  responsible  person- 
ally for  much  of  the  evil  that  has  since  arisen.  But 
there  was  danger  in  the  establishment  of  a  class  sud- 
denly grown  rich,  by  more  or  less  questionable  com- 


THE  FEUITS  OF  COMMEECIALISM     29 

mercial  transactions,  at  the  expense  of  the  nation  — 
a  class  whose  ideals  were  vulgar,  almost  necessarily 
selfish,  and  very  often  unscrupulous.  In  the  hands  of 
this  class  at  the  time  rested  practically  the  commercial 
destiny  of  the  American  people.  It  may  be  questioned 
whether,  with  a  view  to  the  future,  it  could  have  rested 
in  hands  more  dangerous. 

To  the  millionaire  class  the  benefit  has  been  small  in- 
deed. The  men  themselves  of  the  first  generation 
have  been  the  hardest  worked  class  in  the  country ;  with 
no  leisure  time,  and  no  capacity  for  enjoyment,  except 
that  which  could  be  got  by  increasing  their  already  ex- 
cessive riches.  To  the  second  generation  it  has  been, 
as  a  rule,  little  better  than  a  curse.  Some,  indeed,  have 
found  satisfaction  in  following  in  the  footsteps  of  their 
fathers,  and  carrying  to  still  greater  perfection  the 
system  of  unscrupulous  accumulation  originally  set  on 
foot  by  them.  For  the  others  the  result  has  been,  if  not 
worse,  at  least  more  contemptible.  A  life  of  luxury, 
and  self-gratification  —  of  foolish  display,  and  silly 
assumption  of  an  importance  that  belongs  to  their 
money  and  not  to  themselves — may  not  be  morally 
worse  than  one  of  unscrupulous  money-making,  but  at 
least  it  is  one  that  is  felt  to  be  more  akin  to  that  of  the 
monkey  and  less  to  that  of  the  man  than  the  other.  To 
the  nation  at  large  both  varieties  may  be  said  with  jus- 
tice to  have  been  an  all  but  unmitigated  evil. 

Half  a  century  has  passed  since  the  Civil  War,  and 
to-day  America  holds  a  position  in  the  world  of  com- 
merce that  is  second  to  none,  and  will  soon  be  first  of  all. 
If  all  this  is  true,  the  great  question  remains  —  how  has 


30     SOCIAL  WELFARE  m  NEW  ZEALAND 

it  affected  the  well-being  of  the  American  people? 
Are  the  great  majority  of  the  people  better  off  than 
they  were  half  a  century  ago  ?  Are  the  social  and  po- 
litical conditions  of  the  country  better?  Are  they  on 
the  whole  nearly  as  good  now  as  then  ?  An  honest  an- 
swer must  be  in  the  negative. 

In  the  last  forty-five  years  the  nation  has  become 
eminently  commercial.  The  old  ambitions  have  given 
place  to  new,  and  these  have  centred  around  the  ac- 
quisition of  riches.  Half  a  century  ago  an  American 
citizen  might  have  many  ambitions ;  to-day,  with  but  a 
few  exceptions,  he  has  only  one  —  the  ambition  to  grow 
rich  beyond  his  fellows.  It  is  this  that  has  driven,  and 
still  is  driving  more  and  more  irresistibly,  the  young 
American  from  the  healthy  life  of  the  country  to  the 
unhealthy  life  of  the  city.  It  is  this  that  has  taken  pos- 
session of  the  schools,  and  has  degraded  education  from 
its  true  position  as  the  means  of  developing  the  intellect 
of  the  young  to  a  mere  stepping  stone  to  commercial 
success  in  after  life.  It  is  this  that  has  made  Ameri- 
can cities  a  byword  throughout  the  civilised  world  as 
the  headquarters  of  shameless  dishonesty  in  their  gov- 
ernment. It  is  this  that  has  made  American  citizens  ac- 
cept, almost  as  a  matter  of  course,  dishonest  trickery  in 
their  legislators,  and  in  those  to  whom  are  committed 
the  administration  of  affairs,  nominally,  at  least  by 
the  will  of  the  people.  Eifty  years  ago  there  were  no 
great  cities,  a  congestion  that  means  misery  and  vice: 
none  that  were  disfigured  by  slums,  calculated  only  to 
rear  a  new  generation  worse,  both  morally  and  phys- 
ically,  than  that  which  went  before  it:   to-day  such 


THE  FEUITS  OF  COMMEECIALISM     31 

cities  are  springing  up  like  mushrooms,  with  every  in- 
dication that  they  will  prove  to  be  of  a  poisonous  va- 
riety. 

It  may  be  said,  indeed,  that  in  these  cities  work  is 
plentiful,  and  wages  are  higher  than  in  almost  any 
other  country,  but  except  for  the  satisfaction  of  passing 
dollars  through  his  hands  back  to  those  of  the  capital- 
ists, the  workman's  higher  wages  are  little  better  than 
a  delusion.  The  w^orker  pays  more  for  all  necessaries 
than  he  would  in  any  other  country,  and  whenever  he 
secures  an  advance  of  wages,  he  finds  there  has  been 
an  advance  in  the  cost  of  all  he  needs  that  offsets  this. 

Thus  it  would  seem  that  the  commercial  spirit  has 
not  increased  the  well-being  of  the  mass  of  the  people, 
either  in  America  or  elsewhere.  It  has  created  an 
enormously  rich  class,  indeed,  but  in  doing  so  it  has  es- 
tablished an  oligarchy,  enthroned  on  money  bags,  quite 
as  corrupt,  and  more  corruptible  than  any  of  the  older 
oligarchies  that  were  founded  on  strength  or  courage. 
It  has  done  nothing,  or  next  to  nothing,  for  the  general 
well-being  of  the  people.  If  this  is  all  that  a  highly 
developed  commercialism  has  to  offer  society,  it  is  not 
too  much  to  say  that  it  has  proved  itself  a  lamentable 
failure. 


CHAPTER  IV 

NATIONAL    WELL-BEING 

In  what,  it  maj  here  be  asked,  does  tlie  well-being 
of  a  nation,  of  which  we  have  spoken  so  often  in  the 
preceding  pages,  consist  ?  Does  it  involve  an  equal  di- 
vision, and  an  equal  participation  in  everything  that 
constitutes  wealth  and  riches?  Is  it  necessary  that 
all  things  shall  cease  to  have  an  exchangeable  value  be- 
fore society  as  a  whole  can  flourish?  To  many  minds 
such  a  conclusion  is  almost  unthinkable;  to  others  it 
appears  for  many  reasons  most  undesirable.  On  such 
a  question  the  experience  of  the  past  may  be  regarded 
as  probably  the  safest  g-uide  to  our  conclusions. 

This  book  began  with  the  assertion  that  wealth  has 
always  had  a  meaning,  which,  while  it  included  ex- 
changeable value,  included  much  that  could  not  possi- 
bly be  treated  as  a  matter  of  bargain  and  sale.  Liberty 
of  action,  freedom  of  thought  and  speech,  recognised 
political  rights,  that  assure  to  the  majority  of  a  peo- 
ple the  power  to  amend  the  laws  and  direct  its  executive 
Government  at  home  and  abroad  —  all  these,  and  many 
more,  are  elements  of  the  wealth  that  really  contrib- 
utes to  the  happiness  and  well-being  of  a  people. 
'None  of  these  have  an  exchangeable  value ;  yet  all  have 
an  intimate  relation  to  the  wealth  of  a  nation,  even  in 
the  narrowest  meaning  of  the  term. 

32 


IsTATIONAL  WELL-BEI]S^G  33 

From  time  immemorial  riches  have  been  desired  with 
varying  degrees  of  intensity  by  the  vast  majority  of 
human  beings.  They  have  represented  for  them  most 
of  the  things  they  have  thought  worth  having  and  be- 
lieved to  condition  their  well-being.  In  this  they  were 
right  within  certain  definite  limits.  In  all  the  ages, 
and  in  all  nations,  however,  the  quest  of  riches  on  a 
large  scale  has  been  the  cause  of  rapid  deterioration 
in  those  who  were  most  successful  in  obtaining  what 
they  sought,  and  has  proved  the  first  stage  in  the  down- 
fall of  their  nation.  While  a  nation  has  remained  sim- 
ple in  its  tastes,  and  moderate  in  its  desires ;  while  the 
masses,  even  if  poor,  have  not  been  poverty-stricken, 
or  its  wealthy  rolling  in  luxury  —  even  when  both  con- 
ditions have  been  imperfectly  realised  —  it  has  ad- 
vanced and  prospered,  no  matter  where  or  of  what  race 
it  has  been.  But  as  soon  as  a  class  has  arisen  that  has 
succeeded  in  grasping  all  the  riches  within  its  reach, 
progress  has  ceased,  and  its  prosperity  has  decayed. 
In  the  short  six  thousand  years  of  recorded  history 
the  experiment  has  been  tried  by  nearly  every 
nation  that  has  called  itself  civilised;  and  the  result 
has  been  uniform.  This  record  is  written  over  the 
ruins,  for  instance,  of  Egj^^t  and  Babylon,  of  im- 
perial Rome,  commercial  Carthage,  and  conquering 
Spain. 

If  such  is  the  lesson  of  human  experience  as  applied 
to  civilised  communities,  how,  it  may  be  asked,  does  it 
bear  on  what  is  known  to-day  as  Socialism.  If  we  ad- 
mit the  evils  that  have  apparently  invariably  sprung 
from  the  acquisition  by  individuals,  or  a  class,  in  any 


34     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

nation,  of  separate  and  individual  property  in  every 
part  of  the  world,  does  not  this  compel  iis  logically  to 
accept  the  doctrine  that  the  cure  of  these  evils  is  to  be 
found  in  sweeping  away  individualism,  in  obtaining  or 
holding  property  ?  Would  not  a  nation  in  which  all  the 
men  and  women  were  acknowledged  to  have  an  equal 
right  to  an  equal  share  in  all  that  was  produced  by  the 
genius,  industry,  or  ingenuity  of  each  member  of  the 
community  be  an  ideally  prosperous  and  happy  com- 
munity ?  Such  communities  have  been  dreamed  of  by 
philosophers  in  the  past,  and  in  our  own  times  a  good 
many  attempts  have  been  made  to  realise  on  a  small 
scale  the  practical  application  of  their  theories.  Those 
who  have  studied  the  philosophers  have  generally  dis- 
covered the  fact  that  they  have  assumed,  as  the  foun- 
dation of  their  ideal  society  the  existence  of  a  general 
unselfishness  in  their  members  that  certainly  was  not 
to  be  found  in  any  community  of  their  own  time. 
Those  who  in  the  present  age  have  adopted  the  common- 
sense  plan  of  submitting  the  theories  of  the  philoso- 
phers to  the  test  of  practical  experiment  have  found 
in  every  case  that  they  have  been  shipwrecked  by  the 
absence  of  the  spirit  of  entire  unselfishness,  without 
which  success  was  practically  impossible.  Experience 
has  shown  that  while,  as  a  rule,  the  experiments  were 
entered  on  with  absolute  conviction  and  a  whole- 
hearted enthusiasm  by  the  members,  conviction  soon 
grew  weaker  under  the  strain  of  the  sacrifices  that 
were  demanded  for  the  interests  of  others. 

It  may  be  urged  that  human  ideals  have  greatly  ad- 
vanced since  the  time  of  Plato,  or  that  experiments  in 


I 


NATIONAL  WELL-BEING  35 

practical  socialism  made  within  the  last  half  century 
have  been  fatally  handicapped  by  the  atmosphere  of 
individualism  surrounding  them  on  every  side.  Many 
Socialists  assert  that  it  only  needs  an  experiment  on  a 
nation-wide  scale  to  prove  that  advanced  socialism 
would  apply  to  modem  society,  and  would  produce  a 
more  universal  degree  of  well-being  than  any  other  sys- 
tem could.  Eut  such  assertions  are  mere  opinions,  and 
are  warranted  by  no  basis  of  actual  human  experience. 
On  the  contrary,  all  experience  seems  to  show  that  the 
average  man  —  who  must  always  be  the  first  consider- 
ation in  a  case  of  any  successful  reform  —  is  still  too 
selfish  in  his  instincts,  and  habits  of  thought  and  action 
either  to  adopt,  or  persevere  in  any  system  of  advanced 
altruism. 

If,  however,  we  dismiss  the  dreams  of  advanced  so- 
cialism as  for  the  present  entirely  outside  the  bounds 
of  practical  political  reform,  what  meaning  shall  be 
assigned  to  such  words  as  wealth  or  well-being  when 
applied  to  all  classes  of  a  nation  ?  Most  men  will  agree 
that  in  some  sense  or  other  a  nation  must  be  wealthy, 
if  its  people  are  to  be  contented  and  happy ;  and  if  for 
the  purpose  of  avoiding  misunderstanding,  we  use  the 
expression  "  possessed  of  well-being "  instead  of  the 
word  wealth,  the  conclusion  may  be  accepted  as  correct. 
Well-being,  in  truth,  must  to  some  extent  imply,  either 
for  the  individual  or  the  community,  the  possession  of 
the  part  of  wealth  we  call  riches.  It  must  mean  the 
possession  of  sufiicient  riches  to  secure  proper  food, 
clothing,  and  homes,  and  many  other  things,  and  to 
provide  for  the  intellectual  and  other  training  to  fit  cit- 


36     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

izens  for  their  work  in  life,  and  to  afford  a  measure  of 
leisure  and  varied  pleasure. 

Well-being,  therefore,  for  a  nation  involves  the  prac- 
tical adoption  of  the  principle  that  all  have  a  right  to  a 
reasonable  amount  of  comfort  for  the  body,  of  devel- 
opment for  the  mind,  of  training  for  the  faculties,  as 
"well  as  rest,  relaxation,  and  enjoyment  of  life  in  ma- 
turer  years  and  old  age.  It  does  not  involve  the  idea 
that  idleness,  and  carelessness  are  among  the  elements 
of  well-being  either  for  individuals  or  communities; 
but  it  does  emphasise  the  right  that  every  member  of 
society  has  to  obtain  a  fair  and  full  share  of  the  profits 
arising  from  his  exertions.  It  demands  for  the  work- 
ers of  the  nation  wages  sufficient  to  support  a  man 
with  a  family  in  reasonable  comfort,  and  leave  a  mar- 
gin beyond  this  sufficient  to  enable  him  by  self-denial 
and  economy  to  improve  his  position,  and  provide  for 
the  future.  Should  it  appear  that  in  any  trade  these 
essentials  cannot  be  provided,  the  supreme  law  of  na- 
tional well-being  demands  that  that  particular  manu- 
facture or  employment  shall  cease  to  be  carried  on  in 
the  country,  on  the  principle  that  the  well-being  of  the 
people,  and  not  the  employment  or  the  increase  of  cap- 
ital, must  be  the  aim  of  the  community.  It  involves 
also  such  a  supervision  of  every  department  of  work 
as  may  be  needed  to  prevent  injury  or  danger  to  those 
employed,  especially  in  the  case  of  the  women  and  of  the 
young,  on  whom  the  future  of  the  nation  depends.  It, 
in  short,  demands,  as  a  condition  of  national  well-being, 
development,  comfort,  and  the  means  of  happiness  for 
all  classes  of  the  community,  and  most  emphatically  for 


N^ATIONAL  WELL-BEING  37 

those  classes  that  in  tlie  past  have  been  deprived  of 
these  things  for  the  selfish  aggrandisement  of  a  small 
part  of  the  community. 

Such  a  programme  is  sure  to  be  denounced  and  ridi- 
culed by  those  who  accept  the  ideal  of  an  age  of  Com- 
mercialism as  the  best  possible  development  of  civili- 
sation. They  will  consider  the  writer  as  the  dreamer 
of  a  dream  as  unrealisable  as  that  of  the  Utopia  of  the 
Greek  philosopher,  and  his  conception  of  national  well- 
being  as  a  scheme  as  unattainable  as  it  would  be  ruinous 
to  any  nation  mad  enough  to  try  it.  Such  persons  will 
probably  be  ready  to  point  out,  with  an  air  of  su- 
perior wisdom,  that  the  proposal  to  curtail  the  means 
of  heaping  up  riches  in  the  hands  of  those  who  have  al- 
ready more  than  enough,  could  only  have  the  effect  of 
frightening  away  capital,  and  so  rendering  impossible 
the  expansion,  or  even  the  continuance,  of  the  indus- 
tries on  which  the  very  existence  of  the  workers  of  the 
country  depends.  They  vnU.  pour  contempt  upon  what 
will  appear  to  them  our  ignorance  of  the  laws  govern- 
ing production  and  trade,  and  will  contend  that  history 
proves  the  necessity  of  the  existence  of  a  small  class  of 
leaders  that  in  the  nature  of  things  must  grow  rich, 
and  of  a  mass  of  workers  that  must  remain  poor,  if  a 
nation  is  to  be  prosperous.  If  it  were  not  so,  they 
will  assert,  there  would  be  nobody  to  find  the  necessary 
energy  and  ability  —  nobody  that  would,  after  a  very 
short  time,  be  prepared  to  work  at  all. 

From  a  certain  point  of  view  such  a  conclusion  is 
not  unreasonable;  the  defect  lies  in  the  point  of  view 
itself,   which   concentrates   attention   on  the   mere   ac- 


421505 


38     SOCIAL  WELFARE  IN  NEW  ZEALAND 

cumulation  of  riches  as  an  end.  Erom  such  a  view- 
point the  well-being  of  a  whole  people  possessed,  it  may 
be,  of  comparatively  few  luxuries,  but  all  possessed  of 
a  sufficiency  of  what  is  needed  for  happiness  and  com- 
fort, seems  to  them  little  better  than  another  name  for 
national  poverty.  The  national  prosperity  of  commer- 
cialism never  has  been,  and  never  can  be  the  prosperity 
and  happiness  of  a  whole  people. 

If  it  is  admitted,  however,  that  the  prosperity,  hap- 
piness, and  well-being  of  a  whole  people,  and  not  of  a 
part  only,  is  the  object  to  be  aimed  at,  the  question 
arises,  is  there  any  way  in  which  it  can  be  obtained? 
We  are  assured  by  many  persons  who  claim  to  be 
authorities  on  the  question,  that  it  cannot.  We  are 
told  that  human  nature,  and  human  society,  has  been 
so  constituted  by  the  will  of  Providence,  that  there 
must  needs  be  the  very  rich  and  the  very  poor,  as  cer- 
tainly as  there  must  be  the  strong  and  the  weak,  the 
clever  and  the  stupid.  The  advocates  of  commercial- 
ism point  triumphantly  to  the  experience  of  the  past  as 
absolutely  conclusive:  even  ministers  of  religion  are 
ready  to  quote  the  saying  of  the  Founder  of  Chris- 
tianity — "  The  poor  ye  have  vsdth  you  always  " —  as  if 
he  had  said,  "  The  poor  ye  ought  to  have  with  you  al- 
ways." 

The  ideal  foundation  on  which  Christianity  was 
based  was  that  of  the  Kingdom  of  God  upon  earth  —  a 
kingdom  to  be  shared  in  by  every  man,  indeed,  indi- 
vidually, but  for  that  very  reason  applicable  to  every 
community  of  men  such  as  we  call  a  nation.  The  citi- 
zens of  this  kingdom   on  whom  much  —  whether   of 


IN-ATIOE-AL  WELL-BEI:N'G  3^ 

strength  or  talent,  of  genius  or  energy,  of  knowledge 
or  of  wisdom  —  had  been  bestowed,  were  to  hold  it,  not 
for  themselves,  but  for  others.  The  citizens  who  had 
wealth,  or  the  capacity  for  producing  or  acquiring 
wealth,  were  to  be  regarded,  and  to  regard  themselves, 
simply  as  the  trustees  of  that  wealth  on  behalf  of 
others,  and  those  others  the  members  of  the  community 
that  had  the  greatest  need.  This  was  evidently  the 
ideal  of  the  world's  great  Reformer :  it  need  hardly 
be  insisted  that  it  was  not  a  commercial  one.  For 
nearly  fifteen  centuries  the  nations  of  western  Europe 
have  called  themselves  Christian;  but  throughout  all 
these  centuries  not  one  nation  of  them  all  has  ever 
taken  seriously  this  fundamental  idea  of  a  Kingdom 
of  God;  and  now,  in  this  twentieth  century  of  Chris- 
tianity we  announce  with  hardly  concealed  satisfaction 
that  we  live  in  an  age  of  Commercialism. 

It  is  easy  to  foresee  the  answer  that  will  be  given 
to  this.  Some  people  —  though  it  may  be  only  a  few 
—  will  tell  us  frankly  that  the  ideals  of  the  Great 
Teacher  are  out  of  date  —  abandoned  for  ideals  better 
suited  to  the  world  and  its  conditions.  Others,  and 
probably  a  much  larger  class,  of  critics,  will  say  that 
the  Kingdom  of  God  pictured  by  the  Great  Teacher 
was  not  a  social  or  political  ideal  to  be  adopted  by 
communities,  but  one  that  was  applicable  only  to  indi- 
viduals. Arguments  like  these  would  surely  be  used 
against  any  proposal  to  substitute  more  generous  ideals 
for  the  ideals  of  commercialism.  What,  it  would  be 
urged,  if  the  experiment  should  prove  to  be  a  failure  — 
as  it  almost  certainly  would  ?     What  if  the  people  who 


40     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

refused  to  accept  commercialism  as  their  guide  and 
principle  of  national  legislation  grew  poorer  and 
poorer.  Wliat  if  industries  decayed  and  died,  and  the 
nation  fell  back  into  barbarism,  deprived  of  all  the  bene- 
fits of  civilisation  that  have  sprung  from  commercial- 
ism? Is  any  approach  to  this  ideal  of  a  kingdom  of 
God  a  practical  possibility  except  to  a  community  liv- 
ing the  stagnant  life  of  a  tropical  island,  where  work 
is  almost  needless,  and  exertion  of  body  or  mind  a 
waste  of  energy  ? 

These  are  the  questions  that  demand  an  answer,  and 
it  is  with  the  hope  of  supplying  the  answer  that  the 
following  pages  have  been  written.  What  the  writer 
has  to  say  has  the  great  advantage  of  a  record  of  facts, 
not  a  statement  of  theories ;  a  record  of  a  real  present- 
day  experience;  one,  too,  that  can  be  verified  in  a  hun- 
dred ways  by  anybody  who  is  willing  to  do  so.  The 
following  pages  tell  of  a  community  representing  a 
nation  —  the  first  of  its  kind  that  the  world  has  knovni 
—  that  has  ventured  to  defy  the  conclusions  and 
disregard  the  teachings  of  Commercialism.  The  com- 
munity that  has  done  this  is  but  a  small  one  to  be 
regarded  as  a  nation ;  and  the  country  in  which  its 
experiments  have  been  made  is  not  a  very  large  one: 
both,  however,  may  be  looked  on  as  at  least  sufficiently 
large  for  the  purpose  of  offering  a  social  and  political 
object-lesson  for  the  consideration  of  more  populous 
nations  and  larger  countries. 

The  experiments  of  New  Zealand  have  been  unique 
during  the  last  twenty  years  of  its  history;  many  of 
them  have  been  heard  of  in  other  countries,  though 


NATIONAL  WELL-BEING  41 

few  of  them  have  been  carefully  studied.  The  results 
of  those  experiments  have  been  more  remarkable  still, 
and  would  appear  to  demand  from  other  countries  a 
wider,  more  intelligent,  and  more  systematic  attention 
than  they  have  yet  received.  It  is  with  the  hope  that 
this  book  may  prove  an  impulse  to  such  study  that  the 
writer  here  presents  a  faithful  account  of  a  community 
that  has  boldly  attempted  things  branded  heretofore  as 
insane  and  ruinous,  with  the  aim  of  remedying  evils 
elsewhere  treated  as  inevitable.  This  book  will  show 
that,  instead  of  ruin,  the  policy  so  fiercely  denounced 
has  resulted  in  an  increase  of  individual  well-being  for 
the  people  and  of  wealth  for  the  nation  that  is  wholly 
unprecedented  in  the  records  of  history. 


BOOK  II 

AN  OBJECT-LESSON  FROM  NEW  ZEALAND 


CHAPTER  I 

THE  LAND  AND  THE  PEOPLE 

!N"ew  Zealand  is  the  youngest  of  England's  self- 
governing  colonies  that  are  now  known  as  Dominions. 
Canada  had  been  at  least  nominally  a  colony  of  Great 
Britain  for  three-quarters  of  a  century  before  England 
had  thought  of  taking  possession  of  the  far-away  islands 
in  the  south  Pacific  that  had  acquired  an  exceedingly 
bad  reputation,  as  the  home  of  an  unusually  fierce  and 
warlike  race  of  savages.  There  was,  indeed,  at  the  time 
very  little  reason  why  an  English  Government  should 
think  of  making  such  an  addition  to  the  widely  scat- 
tered possessions  for  which  she  was  already  responsible, 
and  probably  nothing  but  the  adventurous  instinct  of 
the  British  people  could  have  compelled  their  Govern- 
ment to  do  so. 

There  had  been  English  missionaries  in  I^ew  Zea- 
land for  more  than  twenty  years,  and  the  news  they 
sent  home  about  the  country  and  the  natives,  many  of 
whom  had  become  at  least  professedly  Christian,  had 
aroused  a  strong  feeling  that  the  almost  unknown 
islands  of  'New  Zealand  had  so  much  in  common  with 
the  British  islands  themselves  that  they  might  form  a 
specially  attractive  field  in  Avhich  to  establish  a  new 
colony.     There  were,  of  course,  risks  to  be  run,  owing 

45 


46     SOCIAL  WELFARE  IN  NEW  ZEALAND 

to  the  large  population  of  natives,  whose  chief  employ- 
ment had  been  war  among  themselves,  which  might 
easily  become  war  against  the  strangers.  On  the  other 
hand  the  country  —  its  land,  its  climate,  and  its  scenery, 
—  had  many  attractions  for  Englishmen.  And  besides 
this  the  characteristic  temper  of  the  race  for  adventure, 
that  had  been  very  largely  suppressed  since  the  loss  of 
the  American  colonies,  was  once  more  in  the  air,  and 
the  more  energetic  young  men  of  the  British  islands  were 
ready  once  more  to  seek  new  homes  and  found  new  na- 
tions in  lands,  however  distant. 

Considerable  efforts  had  been  made  for  several  years 
before  the  beginning  of  1840  to  induce  the  British  Gov- 
ernment to  take  possession  of  the  islands  of  New  Zea- 
land, but  they  had  met  with  very  little  encouragement. 
The  Government  of  the  time  said  England  had  enough 
on  her  hands  already,  and  pointed  to  the  continental 
island  of  Australia  as  a  place  that  afforded  plenty  of 
room  for  new  settlements,  if  people  were  anxious  to  go 
to  the  other  side  of  the  world  to  find  a  new  country. 
The  answer  was  not  effectual  in  putting  a  stop  to  the 
movement  as  settlement  in  Australia  did  not  appeal  to 
the  kind  of  people  that  had  been  attracted  by  the  idea 
of  colonising  New  Zealand.  The  idea  of  the  leaders 
in  the  new  movement  had  been  that  of  establishing  a 
specially  English  colony,  with  a  people  and  social  ideas 
as  nearly  like  those  of  the  old  home  as  possible,  and  for 
many  reasons  that  seemed  difficult  to  do  in  Australia. 
The  climate  did  not  favour  it,  for  one  thing,  as  the 
Australian  climate  is  hot,  and  continental,  and  there- 
fore utterly  unlike  the  old  country.    There  was  no  place 


THE  LAND  AND  THE  PEOPLE    47 

for  English,  farming  in  Australia,  and  the  new  emigra- 
tion movement  was  intended  to  be  very  largely  carried 
out  by  farming  people.  Finally  there  was  already 
a  considerable  British  population  in  Australia,  very 
largely  composed  of  a  very  objectionable  class  of  people 
and  their  children.  In  1840  there  had  already  been  a 
convict  population  sent  from  Britain  to  Australia  num- 
bering fully  80,000  persons,  and  they  and  their  de- 
scendants at  that  time,  formed  the  greater  part  of  the 
population. 

The  promoters  of  the  New  Zealand  settlements  de- 
cided that  they  would  not  change  their  plans,  but,  if 
the  English  Government  would  not  colonise  the  islands 
of  New  Zealand,  they  would  do  it  themselves.  They 
proceeded  accordingly  to  send  out  agents  who  might, 
with  the  assistance  of  the  missionaries  in  the  country, 
who  were  almost  the  only  white  men  who  could  speak 
the  language  of  the  natives,  buy  land  in  suitable  places 
for  settlement.  It  was  in  the  year  1838  that  these 
agents  were  sent  out,  and  in  the  following  year  the  first 
ship-load  of  emigrants  —  the  Pilgrim  Fathers  of  New 
Zealand  settlement  —  sailed  from  Plymouth  Sound  for 
the  new  country. 

It  was  this  which  really  forced  the  hand  of  the  Eng- 
lish Government.  There  had  been  rumours  afloat  that 
the  French  Government  had  some  idea  of  taking  pos- 
session of  the  islands,  and  the  English  Protestant  mis- 
sionaries had  made  strong  representations  that  if  any- 
thing of  the  kind  should  happen  it  would  probably  lead 
to  much  trouble  in  their  work.  This,  no  doubt,  had 
some   effect,   but   the   more   important   fact   that    any 


48     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

interference  bj  the  French  Government  with  English 
settlements  in  the  islands  could  hardly  fail  to  cause  in- 
ternational difficulties,  was  a  far  more  serious  matter; 
for  the  Government  knew  that  even  if  they  had  been 
ready  to  yield,  public  feeling  in  England  so  soon  after 
the  close  of  the  great  war  with  France  would  compel 
them  to  interfere,  or  would  put  others  in  their  place  that 
would.  They  therefore  made  a  virtue  of  necessity,  and 
sent  a  man-of-war,  the  captain  of  which  was  authorised 
to  make  an  agreement  with  the  native  chiefs  to  take  over 
the  sovereignty  of  the  islands  on  fair  terms. 

New  Zealand  became  in  this  way  the  first  example  of 
a  political  experiment  such  as  England  had  never  made 
before.  The  native  chiefs  were  ready  to  give  up  the 
sovereignty  of  their  country  —  which  was  a  thing  they 
didn't  at  all  understand,  as  it  had  never  been  held  by 
any  of  themselves  —  and  to  accept  in  return  presents 
of  blankets,  tobacco,  and  a  few  guns,  and  barrels 
of  powder;  they  were  shrewd  enough,  however, — 
prompted,  it  has  been  said  by  some  of  the  white  traders 
—  to  insist  on  a  condition.  The  white  queen  at  the 
other  side  of  the  world  might  have  the  sovereignty  of  the 
islands,  whatever  that  might  mean,  but  the  land,  which 
the  tribes  claimed  as  their  own  must  not  be  taken  from 
them,  unless  they  chose  to  sell  it  to  the  white  men.  This 
provision  was  embodied  in  the  agreement,  known  as 
"  The  treaty  of  Waitangi,"  the  name  of  the  place  where 
the  Conference  was  held  and  tlie  treaty  signed.  Under 
this  agreement  all  the  land  of  New  Zealand  was  admitted 
to  belong  to  the  native  tribes,  and  the  English  Govern- 
ment bound  itself  not  to  take  any  of  it  from  them,  ex- 


THE  LAND  AND  THE  PEOPLE    49 

cept  with  their  consent,  and  at  a  price  to  be  in  each  case 
agreed  to  bj  the  owners.  It  is  specially  mentioned 
here  because  it  was  not  only  the  firet  new  experiment 
in  the  government  of  tlie  proposed  colony,  but  as  it 
turned  out,  has  had  a  large  influence,  direct  and  indi- 
rect, on  the  history  and  development  of  the  country. 

It  might  have  been  hoped  that  this  provision  for  jus- 
tice and  fair-play  to  the  natives,  would  have  removed  the 
danger  of  war  between  the  tribes  and  the  colonists  — • 
this,  however,  was  not  the  case.  The  natives  were  nu- 
merous, and  had  always  been  fighting  men,  while  the 
white  population  increased  slowly,  and  the  early  settlers 
did  not  impress  the  natives  with  the  idea  that  they  were 
warriors.  There  were  a  few  white  men  in  the  country, 
who  had  for  years  carried  on  a  profitable  trade  with  the 
natives,  chiefiy  by  exchanging  blankets  and  very  in- 
ferior guns  for  the  native  flax,  for  which  there  was  a 
great  demand  in  Sydney.  These  men  had  generally 
married  native  wives,  and  lived  very  much  as  the  natives 
themselves,  and  from  long  association  had  much  influ- 
ence. The  new  order  of  things  did  not  appeal  to  these 
men,  and  it  was  believed  they  sowed  the  seeds  of  dis- 
trust among  the  tribes,  especially  in  the  north  island 
where  all  but  about  three  thousand  of  the  Maoris  lived. 
This  led  to  the  breaking  out  of  two  native  wars  —  the 
first  in  1845,  when  the  colony  was  only  five  years  old; 
and  the  second,  and  much  more  general  war,  in  the  year 
1862,  which  lasted  in  various  parts  of  the  north  island 
for  five  years,  before  it  was  finally  put  an  end  to  by  the 
subjugation  of  the  tribes  in  rebellion. 

The  result  of  these  wars,  especially  the  last,  was  to 


50     SOCIAL  WELFAEE  I^  NEW  ZEALAND 

paralyse  settlement  in  the  northern  island,  and  very 
seriously  to  discourage  immigration  to  the  southern, 
island  also.  It  was  mainly  in  consequence  of  this  that 
at  the  end  of  the  second  native  war  in  the  year  1867, 
when  settlement  had  been  going  on  for  twenty-seven 
years,  the  white  population  of  the  colony  numbered  only 
a  little  more  than  200,000,  of  whom  more  than  half  had 
been  born  in  the  country.  It  was  at  this  point  that  the 
active  development  of  the  colony  may  be  said  to  have 
fairly  begun.  Till  then  it  had  been  hardly  more  than 
a  little  group  of  settlements,  scattered  along  the  coasts 
of  the  islands,  very  much  as  the  earliest  settlements  on 
the  eastern  shore  of  the  United  States  were  scattered. 
The  interior  of  the  north  island  still  belonged  to  the 
native  tribes,  and  was  quite  unsettled  by  white  men, 
and  the  little  coastal  settlements  had  no  means  of  com- 
munication but  by  sea.  These  settlements  had  been 
self-governing,  almost  to  the  same  extent  as  the  States 
of  America,  and  the  whole  of  the  immigration  and 
road  and  harbour  making  of  the  colony  had  been  car- 
ried out  by  these  local  governments. 

The  islands  of  New  Zealand  are  a  little  larger  than 
Great  Britain  alone,  and  rather  smaller  than  Great 
Britain  and  Ireland  together.  They  lie  between  34,30. 
and  47.  degrees  of  south  latitude,  and  though  they  lie 
nearly  north  and  south  their  length  is  not  far  short  of 
a  thousand  miles.  Such  a  length  from  north  to  south 
would  in  the  case  of  almost  any  other  country  be  re- 
sponsible for  a  great  difference  in  climate,  but  in  the 
case  of  New  Zealand  —  a  narrow  country  situated  in 
the  midst  of  a  great  ocean  —  the  difference  of  climate 


THE  LAND  AND  THE  PEOPLE    51 

between  the  extreme  north  and  south  is  but  small.  In 
the  northern  half  of  the  north  island  snow  never  falls, 
except  on  the  higher  hill-tops;  at  the  south  end  of  the 
southern  island  it  falls  occasionally,  but  is  hardly  ever 
known  to  lie  on  the  ground  more  than  twenty-four  hours. 

The  natural  conditions  of  the  two  islands  were 
originally  somewhat  different,  owing  to  the  fact  that  in 
the  southern  island,  in  all  but  its  more  mountainous 
regions,  the  country  was  covered  with  natural  grass 
which,  if  not  very  nutritious,  was  at  least  capable  of 
feeding  cattle  and  sheep  in  large  numbers.  The  north 
island  was  for  the  most  part  covered  with  heavy  forests, 
and,  excepting  at  its  southern  end,  had  little  natural 
grass,  the  open  ground  being  covered  by  a  dense  growth 
of  ferns  of  wonderful  variety  and  beauty,  but  of  no 
value  for  pasture.  There  were  only  between  two  and 
three  thousand  Maoris  (the  aboriginal  natives)  in  the 
south  island,  and  Sir  George  Grey  purchased  the  whole 
island  from  them,  with  the  exception  of  some  reserva- 
tions to  provide  homes  for  the  tribes,  their  support  be- 
ing amply  provided  for  by  the  interest  of  the  purchase 
money.  The  result  was  that  while  it  was  difficult  to  ob- 
tain land  for  settlement  in  the  north,  there  was  abun- 
dance of  land  in  the  south  island  for  sale  by  the  Gov- 
ernment at  a  price  fixed  at  $2.50  per  acre. 

The  southern  settlements  of  the  colony  were  those 
that  most  fully  represented  the  original  ideas  of  the 
New  Zealand  Company,  formed  for  the  colonisation  of 
the  islands  when  the  British  Government  declined  to 
undertake  it.  As  has  already  been  said  the  main  idea 
had  been  the  reproduction  of  English  society  and  con- 


52     SOCIAL  WELFAEE  m  NEW  ZEALAND 

ditions  in  the  new  country.  There  were  to  be  land- 
lords, with  great  estates,  and  tenant  farmers  to  rent 
and  occupy  farms  under  them.  To  carry  out  this  plan 
they  had  induced  members  of  the  old  English  county 
families,  as  they  were  called, —  usually  younger  sons  of 
such  families,  that  could  command  the  necessary  capital 
—  to  join  the  Company,  and  to  induce  sons  of  the 
family  tenants  to  go  -with  them.  To  make  sure  that 
the  land  they  had  bought  from  the  native  owners  should 
bo  kept  in  the  hands  of  one  class  they  had  arranged 
that  it  should  only  be  sold  at  a  high  price,  and  in  large 
areas.  The  plan  was  effectual  till  the  rest  of  the 
island  was  purchased  by  Sir  George  Grey  —  New  Zea- 
land's great  democratic  Governor  —  and  offered  for  sale 
in  small  areas  at  a  reasonable  price  to  all  comers. 
There  seemed  to  be  only  one  way  of  meeting  the  new 
situation,  and  maintaining  the  aristocratic  ideals  of 
the  first  founders  of  these  settlements  —  the  class  of 
large  land  owners  must  buy  up  the  land  within  easy 
reach  of  roads  and  markets. 

The  plan  was  largely  adopted,  especially  in  the  cen- 
tral part  of  the  south  island,  either  by  individuals  or 
by  English  Companies,  and  a  system  of  large  grazing 
"  Euns,"  as  they  were  called  in  imitation  of  the  Aus- 
tralian practice  — "  Ranches,"  as  they  would  have  been 
called  in  America  —  quickly  sprung  up,  which  threat- 
ened to  prevent  any  application  of  that  close  settlement 
for  which  the  country  was  specially  suited.  It  was  soon 
found  that,  owing  to  the  advantages  of  soil  and  climate 
the  plan  was  likely  to  pay  well,  as  large  numbers  of 
cattle  or  sheep  could  be  kept  on  these  runs  all  the 


THE  LA:N^D  and  the  people  53 

year  round  at  very  small  expense,  yielding  good  inter- 
est on  the  capital  invested,  witli  the  prospect  of  greatly 
increased  value  in  the  future.  The  speculation  seemed 
to  promise  so  well  that  a  good  many  companies  were 
formed  in  England  for  the  purpose  of  buying  ITew 
Zealand  land  throughout  the  south,  and  to  a  consider- 
able extent  at  the  southern  end  of  the  north  island,  and 
the  danger  appeared  great  of  the  country  becoming  the 
possession  of  a  capitalistic  class  of  landlords  who  would 
practically  control  its  future. 

The  introduction  of  a  policy  of  Immigration  and 
Public  Works  was  fatal  to  this  social  and  economic 
policy  of  large  land-holdings  in  'Kew  Zealand.  This 
took  place  in  1872,  its  object  being  to  open  up  the 
country  at  a  distance  from  the  ports  by  the  construc- 
tion of  railroads,  and  to  introduce  labour  to  carry  on 
the  works  and  eventually  to  settle  on  the  land.  The 
landlord  party  was,  in  the  first  instance,  the  most  favour- 
able to  the  new  policy  which  held  out  the  prospect  of  an 
early  increase  of  value  for  their  estates,  but  a  few 
years'  experience  showed  that  the  increase  of  popula- 
tion—  which  was  greater  during  the  period  between 
the  years  1873  and  1882  than  in  any  other  ten  years  of 
the  history  of  the  colony  —  led  directly  to  the  intro- 
duction of  the  policy  of  anti-monopoly  with  respect  to 
the  land  of  the  country.  The  policy  of  railroad  and 
harbour  construction  and  improvement  involved  the  ne- 
cessity of  borrowing  large  sums  on  the  security  of  the 
colony  as  a  whole,  the  interest  of  which  threatened  to 
become  a  serious  burden  on  so  small  a  community. 
The  introduction  during  the  period,  mainly  by  Gov- 


54     SOCIAL  WELFAEE  IK  NEW  ZEALAND 

ernment  assistance,  of  fully  120,000  immigrants,  while 
for  the  time  it  created  a  fictitious  prosperity,  led  in. 
the  end  to  something  approaching  a  crisis,  when  the 
public  works  that  had  given  employment  to  the  new- 
comers had  to  be  discontinued,  owing  to  the  exhaustion 
of  the  public  credit  in  the  English  stock  market. 

In  18S2  the  colonists  of  New  Zealand  —  almost  ex- 
actly half  a  million  in  number  at  the  time  —  had  bor- 
rowed $100,000,000  in  England  to  carry  out  their  pub- 
lic works  and  immigration  policy.  They  owed  nearly 
$50,000,000  more,  that  had  been  previously  borrowed, 
chiefly  to  pay  the  costs  incurred  in  putting  down  the 
native  rebellions,  and  in  purchasing  land  for  settle- 
ment from  the  native  tribes.  In  this  way  the  debt  of 
the  young  country  with  its  half  million  people,  amounted 
to  as  nearly  as  possible  $300  for  every  man,  woman  and 
child  in  the  colony.  The  annual  charge  for  interest 
was,  of  course,  heavy,  as  the  money  had  been  lent  spec- 
ulatively to  a  very  young  and  small  community,  and  in 
1882  it  amounted  to  an  annual  burden  of  about  $14 
per  head  on  the  whole  population.  Under  the  circum- 
stances it  is  not  surprising  that  the  period  between 
1882  and  1892  was  one  of  depression  and  comparative 
stagnation  for  New  Zealand  and  its  people. 

There  were,  however,  two  important  compensations. 
The  most  obvious  of  these  was  that  considerably  more 
than  two-thirds  of  the  debt  incurred  by  the  young  colony 
had  been  spent  on  works  that  formed  a  valuable  asset; 
in  the  purchase  of  a  large  part  of  the  land  of  the  coun- 
try, which  was  certain,  sooner  or  later,  to  make  a  good 
return;  and  in  the  introductio(n  of  a  well-selected  pop- 


THE  LAND  AND  THE  PEOPLE    55 

Illation  of  more  or  less  skilled  workers  from  England. 
The  second  compensation,  though,  much  less  obvious  at 
the  time,  has  in  all  probability  contributed  even  more 
than  the  first  to  the  success  of  the  country  and  its  peo- 
ple; it  consisted  in  the  necessity,  forced  on  the  Legis- 
lature and  people  of  the  colony,  to  enter  on  a  course  of 
social  and  economic  reforms,  unattempted  elsewhere, 
and  dreaded  by  many  at  the  time,  that  has  resulted  in  a 
great,  and  indeed  unparalleled  success.  The  first  of 
these  compensations  was,  it  need  hardly  be  said,  felt 
more  or  less  clearly  at  the  time.  During  the  first  few 
years  of  the  period  large  purchases  of  land  were  made 
by  speculators  and  foreign  companies,  in  districts,  es- 
pecially of  the  south  island,  where  it  was  expected  the 
construction  of  new  railroads  was  likely  to  increase 
values,  and  the  revenue  derived  from  the  railroads  went 
far  to  pay  the  interest  on  the  cost  of  construction.  In 
addition  to  these  helps  to  lightening  the  burden  of  debt 
there  was  the  new  population,  repaying  in  part  the 
cost  of  its  introduction  by  half  yearly  instalments,  and 
materially  increasing  the  customs  revenue  from  imported 
goods. 

This  continued  for  a  few  years  to  disguise  the  truth 
that  the  burden  was  too  gTeat  for  the  average  members 
of  the  young  community  who,  with  little  or  no  capital 
were  struggling  to  make  homes  for  themselves  in  the 
country ;  as  soon,  however,  as  it  began  to  be  evident  that 
the  policy  of  extensive  borrowing  must  cease,  it  became 
evident  that  some  other  policy  must  take  its  place. 
The  new  population  which  had  added  to  the  apparent 
prosperity  of  the  country  as  long  as  public  works  re- 


56     SOCIAL  WELFAEE  m  NEW  ZEALAND 

quired  many  hands,  paid  for  liberally  out  of  loans, 
added  to  the  depression  when  work  grew  scarce  and 
taxation  continued  heavy.  Many  of  the  men,  indeed, 
wished  to  settle  as  farmers  on  the  land,  but  found  that 
the  best  and  most  accessible  land  was  in  many,  if  not 
most,  cases,  already  bought  up  by  capitalists,  either  in 
the  colony  or  in  England,  who  would  not  sell,  except 
on  terms  that  seemed  exorbitant. 

This  was  the  state  of  things  that  faced  the  young 
country  and  its  rulers  in  the  ten  years  between  1882 
and  1892,  and  it  soon  became  evident  that  it  must  be 
dealt  with  firmly  if  the  country  and  its  people  were 
to  be  rescued  from  a  long  period  of  depressing  stagna- 
tion. Its  people,  indeed,  could  live  in  a  frugal  fashion, 
and  might  even  hope  to  go  on  paying  the  interest  on 
their  national  loans,  but  the  hope  of  progressive  devel- 
opment was  not  bright.  Men  who  would  gladly  have 
remained  in  the  colony  if  they  could  have  obtained  work 
at  anything  like  good  wages,  began  to  turn  their 
thoughts  to  one  or  other  of  the  Australian  colonies, 
where  both  work  and  money  were  more  plentiful.  Men 
who  had  hoped  to  settle  down  as  farmers,  if  they  could 
have  bought  small  farms  within  easy  distance  of  some 
market,  complained  that  little  or  none  of  such  land  was 
available,  except  on  terms  that  would  have  left  them 
at  the  mercy  of  the  capitalists  who  sold  the  land  and 
held  most  of  the  price  paid  as  a  mortgage  at  seven  or 
eight  per  cent,  interest.  The  consequence  was  that  in 
the  years  between  1884  and  1892  settlers  began  to 
leave  the  country  in  considerable  numbers  and  to  re- 
move to  New  South  Wales  or  Victoria.     During  these 


THE  LAND  AND  THE  PEOPLE    57 

years  eight  thousand  more  people  left  New  Zealand  than 
came  into  the  country,  and  people  in  Australia  began 
to  point  to  the  island  colony  as  one  apparently  doomed 
to  failure. 

Two  things  seemed  to  be  mainly  responsible  for  the 
growing  unpopularity  of  the  country  as  a  field  for  set- 
tlement; the  first  and  most  obvious  of  these  was  the 
difficulty  of  getting  land  cheaply  in  districts  that  were 
near  a  market.  Such  land  could  be  bought,  but  only 
at  a  high  price,  and  by  the  time  a  settler  had  brought 
himself,  with  a  wife  and  family  from  England,  at  a 
cost  of  a  hundred  dollars  per  head,  he  had  not,  as  a 
rule,  money  to  spare  to  buy  land  at  a  fancy  price.  It 
had  always  been  a  difficulty  in  the  way  of  settlement 
that  the  expense  of  the  voyage  was  so  great,  and  the 
distance  from  home  and  friends  was  so  extreme:  now 
that  the  colony  was  getting  a  bad  name  in  England, 
as  a  country  in  which  farms  were  not  to  be  got  on  rea- 
sonable terms,  it  was  becoming  impossible.  The  other 
cause  of  trouble  was  the  heavy  debt,  and  the  conse- 
quently heavy  taxation.  The  prospect  that  State  rail- 
roads would  pay  had  depended  on.  the  expectation  of  a 
large  increase  of  population  that  would  use  them  — 
they  certainly  would  not  pay  if  population  deserted  the 
colony  instead  of  flocking  into  it.  The  problems  of  New 
Zealand  therefore  centred  round  the  land  in  the  period 
between  1880  and  1890,  and  they  were  serious  enough 
to  demand  a  solution  of  some  kind. 


CHAPTER  II 

THE    LAND    POK    THE    PEOPLE 

I^EW  Zealand  is  not  a  large  country.  Its  total 
area  amounts  to  a  little  less  than  sixty-seven  million 
acres  —  or  about  six-sevenths  the  extent  of  Great  Brit- 
ain and  Ireland.  It  has  the  advantage  over  the  Brit- 
ish islands  that  a  greater  proportion  of  its  land  is 
available  for  cultivation;  it  has  also  the  greater  ad- 
vantage that  its  climate  is  in  every  respect  more  favour- 
able for  agriculture.  There  are  probably,  therefore,  at 
least  48,000,000  acres  of  land  suitable  for  farming  — 
an  area  which,  taking  into  account  the  character  of 
the  soil  and  the  advantages  of  the  climate,  should  be 
capable  of  supporting  a  population  of  from  eight  to 
ten  millions  in  comfort,  without  depending  on  any  other 
country  for  any  of  the  necessaries  of  life.  The  first 
need  of  such  a  country  as  this  was  manifestly  a  suit- 
able population  to  develop  its  natural  resources;  and 
the  difiiculty  of  obtaining  such  a  population  under  the 
circumstances  of  the  young  colony  was  the  problem 
that  confronted  the  settlers  of  ISTew  Zealand  from  twenty 
to  thirty  years  ago. 

It  is  a  fact,  too  little  recognised  by  every  nation  in 
the  past,  that  national  well-being  is  in  all  cases  pri- 
marily dependent  on  the  land  of  the  country  which  they 

Q8- 


THE  LAND  FOR  THE  PEOPLE     59 

occupy.  In  a  huge  continental  country  such  as 
America,  Canada,  or  Australia,  it  is  always  easy  to 
overlook  or  forget  this,  because  the  supply  appears  to 
be  so  inexhaustible.  A  small,  insular  country  like  New 
Zealand  was  not  exposed  to  this  temptation,  and  the 
most  intelligent  of  its  colonists  almost  from  the  first 
had  recognised  the  fact  that  on  the  proper  manage- 
ment and  steady  development  of  its  lands  by  an  intelli- 
gent people,  accustomed  to  the  free  and  healthy  life 
which  settlement  on  the  land  afforded,  the  really  pros- 
perous and  satisfactory  future  of  the  nation  depended. 
There  had  always  been  a  considerable  section  of  the 
people  opposed  to  the  policy  of  borrowing  largely  for 
the  construction  of  public  works  in  advance  of  the 
needs  of  the  population,  accompanied  by  the  importa- 
tion of  a  large  number  of  workers  to  be  maintained  by 
wages  drawn  from  the  loans.  It  was  felt  that  there 
was  a  danger  of  depression  when  the  works  were  com- 
pleted, as  well  as  one,  hardly  less  serious,  that  the  un- 
due extension  of  railroads  would  lead  to  speculation  in 
the  limited  supply  of  land  at  the  disposal  of  the  Gov- 
ernment. The  misgivings  of  the  party  opposed  to  the 
policy  of  hasty  development  with  borrowed  capital  was 
fully  justified  by  the  results  in  both  directions  within 
ten  years.  When  the  results  of  the  policy  they  had  op- 
posed were  recognised  by  the  people  as  serious  they 
were  called  on  to  undertake  the  task  of  finding  a  remedy. 
There  is  probably  no  people  more  conservative  than 
the  English  people,  especially  of  the  agricultural  class ; 
and  there  is  no  subject  on  which  their  ideas  are  more 
settled  than  that  of  the  sacredness  of  aU  rights  that  af- 


60     SOCIAL  WELFARE  IN  NEW  ZEALAND 

feet  the  land.  A  large  majority  of  the  New  Zealand 
settlers  had  originally  belonged  to  the  class  of  Eng- 
lish farmers,  and  it  seemed  probable  that  their  children, 
though  born  in  the  new  country  would  largely  inherit 
their  ideas.  The  men  who  had  to  face  the  question  of 
reform  in  dealing  with  the  land  of  the  colony  did  not 
generally  share  the  feeling  of  veneration  for  vested  in- 
terests in  land ;  but  they  were  wise  enough  to  approach 
the  subject  cautiously.  It  was  clear  that  if  the  colony 
was  to  grow  prosperous  land  monopoly  by  capitalists 
must  cease;  it  was  most  desirable  that  by  some  means 
the  land  monopolists  should  be  induced  to  get  rid  of 
their  large  estates,  by  selling  the  land  they  were  really 
holding  for  speculative  purposes,  to  people  who  would 
settle  on,  and  do  their  best  to  make  the  most  of  it 

The  policy  they  adopted  was  of  two  kinds.  They 
passed  laws  that  introduced  a  system  of  taxation  on 
land  on  a  sliding  scale.  Holdings  that  did  not  ex- 
ceed five  hundred  acres  were  free  from  the  tax;  those 
of  larger  area,  but  not  exceeding  five  thousand  acres 
paid  a  land  tax,  which  increased  gradually  with  every 
additional  five  thousand  acres  till  it  reached  a  total  of 
five  per  cent,  on  the  actual  market  value  of  the  land 
for  estates  of  more  than  fifty  thousand  acres.  The  pur- 
pose of  this  statute,  which  was  afterwards  amended  by 
the  addition  of  a  special  surtax  in  addition  to  the 
other,  in  all  cases  in  which  the  owners  of  the  land  — 
whether  individuals  or  companies  —  lived,  or  had  their 
headquarters  outside  the  colony  itself,  was  of  course, 
to  induce  them  to  cut  up  the  estates,  and  sell  to  small 
holders.     The  new  laws  were,  as  a  matter  of  course, 


THE  LAND  FOE  THE  PEOPLE     61 

denounced  as  an  attempt  at  confiscation,  which,  their 
authors  were  not  bold  enough  to  try  openly;  and  the 
tax  on  absentees  was  held  up  to  ridicule,  as  a  childish 
attempt  to  drive  foreign  capital  out  of  the  country. 
Prom  the  point  of  view  of  the  colonial  Government, 
however,  the  most  serious  criticism  to  which  the  law 
was  liable  was,  that  it  did  not  succeed  in  making  the 
great  monopolists  give  up  their  hold  on  the  land.  To 
some  extent,  indeed,  it  helped  the  revenue  of  the  coun- 
tiy  by  placing  the  burden  of  about  half  a  million  dol- 
lars on  the  shoulders  of  the  land-holding  capitalists  that 
would  otherwise  have  fallen  on  the  general  public,  less 
able  to  bear  it  —  but  it  did  not,  as  was  found  after  a 
few  years'  experience,  induce  them  to  sell  the  land  they 
were  holding  in  the  confident  expectation  that  within  a 
few  years  it  would  greatly  increase  in  value. 

The  second  branch  of  the  new  policy  was  more  suc- 
cessful. It  dealt  with  the  land  still  in  the  hands  of 
the  nation,  as  well  as  of  lands  that  might  afterwards  be 
purchased  from  the  native  tribes.  A  large  proportion 
of  the  best  of  this  land  was  set  aside  as  land  that 
could  only  be  obtained  as  a  leasehold  in  perpetuity 
from  the  Government.  The  idea  was  a  new  one,  em- 
bracing in  a  novel  form  the  idea  set  forth  about  the 
same  time  in  America  by  Henry  George.  Under  the 
new  law  of  New  Zealand,  land  suitable  for  close  settle- 
ment could  be  selected  by  persons  of  full  age  on  the 
conditions  that  they  lived  on  the  land  selected,  and 
made  certain  improvements  in  each  year  after  the  first. 
After  the  first  three  years  when  it  was  proved  that 
they  had  fulfilled  the  conditions  as  to  living  on  the 


62     SOCIAL  WELFAEE  11^  NEW  ZEALAND 

land,  and  making  improvements  of  the  value  agreed  on, 
they  were  granted  the  lease,  which  made  them  liable  to 
pay  to  the  Government  rent  at  the  rate  of  four  per  cent, 
on  the  price  at  which  public  land  of  the  same  quality 
had  been  offered  for  sale  as  freehold.  It  was  provided 
in  every  lease  that  at  the  close  of  each  period  of  twenty- 
one  years  the  land  should  be  revalued  by  a  court  of  as- 
sessment, and  the  rent  payable  during  the  next  twenty- 
one  years  should  be  at  the  rate  of  four  per  cent,  on  the 
ascertained  value,  which  was  to  include  the  value  of 
the  land  only,  without  reckoning  improvements  made 
by  the  tenant.  Under  this  statute  no  person  could  ob- 
tain more  than  320  acres,  nor  could  he  (or  she,  for 
there  was  nothing  in  the  statute  to  prevent  a  woman 
holding  a  lease  from  the  Government)  purchase  from 
any  other  person  land  held  under  perpetual  lease 
amounting  on  the  whole  to  more  than  three  hundred  and 
twenty  acres. 

This  new  system  came  into  force  in  the  beginning  of 
1883,  though  it  was  several  years  later  before  it  was 
taken  advantage  of  to  any  considerable  extent.  Dur- 
ing the  first  three  years  only  about  twenty-five  thou- 
sand acres  were  settled  in  each  year  under  the  new  sys- 
tem, but  from  that  time  onward,  at  least  for  a  good 
many  years,  the  popularity  of  the  new  land  title  in- 
creased, until  more  than  a  million  acres  were  occupied 
as  perpetual  leaseholds  within  ten  years  of  the  first  in- 
troduction of  the  system.  As  a  rule  the  leaseholds  did 
not  exceed  the  160  acre  limit,  so  that  the  result  of 
the  new  land  law  had  been  the  settlement  on  the  land 
of  about  three  thousand  families,  hardly  any  of  whom 


THE  LAND  FOR  THE  PEOPLE     63 

could  probably  have  obtained  farms  of  their  own  if  they 
had  been  obliged  to  pay  for  the  land,  while  very  few 
indeed  would  have  had  the  means  of  improving  the  land 
and  purchasing  either  cattle  or  sheep  to  produce  a  return. 

The  result  of  the  amendment  of  the  land  laws  was 
at  once  to  put  a  stop  to  the  attempts  of  the  capitalist 
sjDeculators  to  monopolise  the  land,  but  it  did  not  undo 
the  mischief  that  had  already  been  done  by  the  buy- 
ing up  of  large  estates  of  the  best  land,  generally  sit- 
uated in  the  districts  nearest  to  the  ports  and  young 
cities  that  offered  markets  for  the  produce.  The  new 
railroads,  it  is  true,  opened  up  a  good  deal  of  the 
country,  and  made  it  possible  to  send  produce  to  the 
markets ;  but  even  in  that  case  much  of  the  land  near- 
est the  railroads  had  been  bought  up  in  large  areas, 
and  was  being  used,  with  little  or  no  improvement, 
for  cattle  and  sheep  runs  and  even  in  cases  where  good 
land  was  available  near  the  new  railroads,  the  neces- 
sary cost  of  bringing  the  produce  to  market  was  felt 
to  be  a  grievance,  and  prevented  settlement  in  what 
were  called  the  "  back-blocks." 

This  led  the  Government  and  the  Parliament  to  amend 
the  law  further,  by  offering  a  new  title  to  land  in  small 
areas,  on  the  condition  of  occupation  and  improvement. 
The  new  statute  authorised  the  Government  to  offer 
public  lands,  specially  set  aside  for  the  purpose,  for 
leasehold,  with  the  right  of  purchase.  There  was  no 
idea  of  departing  from  the  principle  of  close  settle- 
ment in  the  amendment  of  the  law,  nor  was  it  intended 
to  leave  any  opening  for  speculative  purchases.  The 
policy  of  the  party  was  first  of  all  to  put  a  stop  to  the 


64     SOCIAL  WELFAEE  m  NEW  ZEALAND 

monopoly  of  the  public  lands,  bought  from  the  native 
tribes  with  the  money  of  the  people,  and  in  the  next 
place  to  have  it  occupied  as  real  farms  by  people  V7ho 
were  prepared  to  live  on  and  cultivate  it.  The  new 
feature  was  that  of  optional  purchase  after  residence 
on  the  land  for  at  least  ten  years,  and  after  the  im- 
provements required  by  the  terms  of  the  lease  had  been 
made.  The  rent  charged  on  lands  held  with  the  option 
of  purchase  was  five  per  cent,  on  the  value  of  the  land 
—  which  in  the  case  of  good  agricultural  land  was  $5 
(£1)  per  acre  —  and  it  could  be  purchased  as  free- 
hold by  the  holder  of  the  lease  at  any  time  between  the 
tenth  and  twenty-fifth  years  of  the  tenancy  by  pay- 
ment of  that  amount.  In  case  the  holder  of  the  lease 
did  not  buy  the  freehold  within  the  twenty-five  years 
for  which  the  lease  extended,  he  might  exchange  it  for 
a  lease  in  perpetuity  at  four  per  cent.,  without  the 
right  to  purchase.  The  improvements  demanded  both 
from  the  holders  of  land  under  perpetual  lease  and 
those  holding  leases  with  right  of  purchase,  were  fixed 
at  ten  per  cent,  during  the  first  year,  and  thirty  per 
cent,  on  the  original  cash  price  of  the  land  during  the 
first  six  years  of  the  tenancy. 

Provisions  were  made  in  later  statutes  for  special 
settlement  associations  extending  to  not  more  than 
eleven  thousand  acres  in  all,  no  one  of  the  members 
being  allowed  to  hold,  or  to  acquire  from  others,  more 
than  320  acres  in  all.  Public  lands  not  suited  for  agri- 
cultural settlement,  or  situated  in  districts  too  far 
from  markets  to  be  required  for  farming,  were  set 
apart  under  another  statute  for  pastoral  leaseholds  for 


THE  LAND  FOR  THE  PEOPLE    65 

a  short  term  of  years  at  a  rental  of  two  and  a  half  per 
cent,  on  the  selling  value  of  the  land.  All  such  leases 
required  their  holders  to  reside  on  the  land,  and  in 
cases  in  which  the  land  was  found  to  be  suitable  for 
agricultural  occupation  the  land  might  be  resumed  bj 
the  Government  on  giving  one  year's  notice  to  the 
tenant;  and  all  pastoral  leaseholds  were  rendered  liable 
to  occupation  for  mining  purposes  at  any  time  under 
the  general  laws  of  the  colony  regulating  mining. 

It  will  thus  be  seen  that  every  effort  was  made  to 
deal  with  the  land  of  ISTew  Zealand  in  the  way  best 
calculated  to  develop  the  natural  resources  of  the  coun- 
try, and  to  attract  the  class  of  immigrants  best  calculated 
to  increase  its  wealth,  without  taking  any  steps  to  in- 
terfere directly  with  the  vested  interests  in  the  land 
that  had  been  already  acquired,  either  by  individuals 
or  companies.  It  was  fully  appreciated  by  those  in 
power  that  any  such  legislation  would  be  met  with  fierce 
opposition  by  those  immediately  affected,  and  that  it 
would  render  the  colony  the  subject  of  most  unfavour- 
able criticism  that  might  seriously  interfere  with  its 
progress.  It  was  only  by  slow  degrees  that  it  dawned 
on  them  that  the  menace  to  the  future  of  the  country 
arising  from  the  continued  existence  of  great  estates, 
occupying  lands  that  were  needed  for  settlement,  was  a 
more  serious  danger  still.  The  doctrine  which  had  been 
accepted  generally  throughout  the  colony  that  the  orig- 
inal and  chief  interest  in  the  land  belonged  to  the 
people  as  a  whole,  and  not  to  any  individual  or  class  of 
individuals,  seemed  to  demand  that  something  should 
be  done  to  deal  with  the  problem  of  large  estates,  stand- 


66     SOCIAL  WELFiVEE  m  NEW  ZEALAND 

ing  in  the  way  of  national  improvement.  It  was  this 
conviction  which  led  to  the  adoption  of  the  first  New 
Zealand  statute  that  may  fairly  be  said  to  have  definitely 
broken  away  from  the  long  accepted  ideas  of  the  Eng- 
lish race  on  the  relation  between  private  rights  and 
public  interests.  It  is  true,  of  course,  that  even  in 
England  the  law  of  eminent  domain  had  long  been 
admitted  to  exist.  In  the  case  of  water-ways,  and 
later  of  railroads,  it  had  even  been  made  use  of  to  se- 
cure land  for  construction  purposes,  but  it  had  been 
exercised  sparingly  and  grudgingly,  as  a  concession  that 
was  at  least  half  a  favour.  And  this  was  in  the  case 
of  land  that  had  been  so  long  in  the  hands  of  its  pos- 
sessors that  the  way  in  which  it  had  originally  been 
acquired  had  been  almost  if  not  quite  forgotten.  In 
the  case  of  New  Zealand  it  was  but  the  other  day  that 
the  land  had  been  bought,  and  the  money  paid  for  it, 
as  it  might  have  been  for  any  other  property.  The 
colony  had  offered  the  land  for  sale,  and  the  present 
owners  had  bought  it  for  cash,  which  had  been  used 
for  public  purposes.  They  had  acted  within  the  limits 
of  the  law  as  they  found  it,  and  they  claimed,  as  a  mat- 
ter of  absolutely  unimpeachable  right,  to  use  it  as  they 
pleased,  or  not  to  use  it  at  all,  if  it  suited  them  better. 
This  was  really  the  parting  of  the  ways,  as  far  as 
New  Zealand  was  concerned.  Public  ownership  of 
railroads  and  telegraph  lines,  might  be  novelties,  new 
to  English  experience,  but  they  had  been  made  with 
public  money  at  any  rate.  Any  attempt  to  force  peo- 
ple who  had  bought  and  paid  for  public  lands  to  give 
it  up  again,  for  no  other  cause  than  that  they  had  too 


THE  LAND  FOR  THE  PEOPLE     67 

much,  was  a  direct  attack  on  the  vested  rights  of  the 
owners,  and  a  defiance  of  the  rule  of  capital.  What 
was  done  in  jSTew  Zealand  was  done  deliberately,  with  a 
full  knowledge  of  the  meaning  of  the  step,  and  a  full 
appreciation  of  the  way  in  which  it  would  be  regarded, 
and  criticised  in  other  countries,  and  perhaps  most  of 
all  in  England,  on  which  the  colony  was  entirely  de- 
pendent for  any  further  loans  it  might  require,  and 
even  for  credit  in  the  ordinary  transactions  of  com- 
merce. English  capitalists  had  invested  a  good  deal  of 
money  in  the  purchase  of  land  in  New  Zealand,  and 
still  more  in  loans  both  public  and  private,  the  se- 
curity of  which  depended  on  the  prosperity  of  the 
country.  This  prosperity,  it  had  been  admitted  tacitly, 
and  proclaimed  loudly  for  half  a  century,  meant  the  su- 
premacy of  capital,  and  its  security  from  attack  in  any 
country,  and  surely  most  of  all  in  one  so  young,  and  so 
handicapped  by  distance  from  all  the  markets  of  the 
civilised  world. 

The  risk,  it  could  hardly  be  denied,  was  a  serious 
one,  but  the  convictions  of  the  people  and  representatives 
of  the  colony  were  sincere.  They  had  unquestionably 
the  power  to  make  such  laws  if  they  chose  to  do  so  un- 
der the  constitution  of  the  country;  and  having  al- 
ready tried  other  means  of  inducing  the  land  monop- 
olists to  give  up  their  hold  by  selling  at  a  fair  price  to 
those  of  the  community  who  were  ready  to  buy,  and 
settle  on  the  land,  they  did  not  hesitate  to  take  the 
last  step  that  was  apparently  necessary  to  secure  the 
benefit  of  the  land  for  the  people. 

The  statute  passed  to  give  effect  to  the  new  policy 


68     SOCIAL  WELFARE  I^  NEW  ZEALAND 

was  merely  an  extension  of  the  recognised  old  English 
law  of  eminent  domain  to  all  lands  held  in  large  areas 
by  individuals  or  corporations.  It  provided  that, 
whenever  it  appeared  that  a  sufficient  number  of  per- 
sons of  full  age  should  apply  to  the  Lands  Department 
of  the  Government,  declaring  their  desire  to  take,  and 
personally  occupy  for  purposes  of  farming,  any  lands 
forming  part  of  a  freehold  estate  of  more  than  five 
thousand  acres  in  extent,  it  should  be  lawful  for  the 
Government,  having  first  ascertained  that  the  land  ap- 
plied for  was  suitable  for  the  purposes  of  agriculture 
under  a  system  of  close  settlement,  to  purchase  the 
land  from  the  owners  at  its  market  value.  In  case  the 
owners  should  refuse  to  sell  the  land,  or  in  case  no 
agreement  could  be  arrived  at  as  to  its  value,  it  was 
provided  that  the  question  of  present  value  should  be 
referred  to  a  Court  of  Assessment,  which  should,  after 
notice  to  the  owners,  hold  an  inquiry  into  the  question, 
and  having  taken  evidence  publicly,  should  assess  the 
value  of  the  estate,  reserving  to  the  owner  the  right  to 
retain  the  homestead  (should  any  such  exist),  v^dth  the 
adjoining  land  to  a  reasonable  amount.  The  Govern- 
ment was  then  empowered  to  enter  upon  and  take  pos- 
session of  the  rest  of  the  estate,  paying  to  the  owners 
the  assessed  value;  and  having  done  so  to  survey  it  — 
laying  out  the  necessary  roads,  and  dividing  the  land 
itself  into  sections  not  exceeding  three  hundred  and 
twenty  acres  in  extent.  On  the  completion  of  the  sur- 
vey, it  was  provided  that  the  farms  should  be  allotted 
among  the  original  applicants,  the  order  of  selection 
being  decided  by  lot. 


THE  LAND  FOR  THE  PEOPLE    69 

Tlie  farm  lands  thus  selected  were  to  be  held  on 
perpetual  lease  from  the  nation,  on  the  same  terms 
as  other  lands  held  under  the  same  title,  as  to  revalua- 
tion at  the  end  of  each  term  of  twenty-one  years,  and  the 
payment  of  rental  at  the  rate  of  four  per  cent,  on 
the  cost.  In  the  case  of  lands  bought  in  this  way  by 
the  Government  the  original  cost  was  arrived  at  by 
adding  the  expense  of  valuation,  survey,  and  road- 
making  to  give  access  to  the  farms,  to  the  amount  paid 
to  the  original  freeholders  on  assessment.  The  total 
cost  was  then  divided  by  the  acreage  of  the  new  farms 
and  the  rental  fixed  at  four  per  cent,  on  the  cost  per 
acre  thus  ascertained.  In  this  way  the  community,  as 
a  whole,  was  protected  against  loss,  it  being  calculated 
that  whatever  money  was  required  for  such  land  pur- 
chases could  be  borrowed  at  three  and  a  half  per  cent., 
and  that  the  additional  half  per  cent,  would  provide  a 
sufficient  fund  to  pay  the  expense  of  administration  and 
supervision. 

This  assertion  of  the  people's  paramount  ownership 
of  the  land  was  the  first  practical  step  in  a  policy  of 
State  socialism.  It  is  true  that  neither  the  men  who 
introduced  the  policy,  and  passed  the  statutes,  nor  the 
land  monopolists,  who  indignantly  resisted  and  de- 
nounced the  new  policy,  foresaw  what  it  meant  to  the 
future  legislation  and  development  of  the  country ;  but 
so  far,  at  least,  as  its  immediate  effect  as  a  fatal  blow 
to  the  establishment  of  a  class  of  great  landed  pro- 
prietors, such  as  existed  in  Great  Britain,  or  of  great 
land  monopolists  such  as  was  growing  up  in  America, 
was  concerned,  it  was  fully  appreciated  by  the  capitalist 


70     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

class.  The  hope  was  at  first  entertained  that  the  new 
law,  so  contrary  to  old  English  ideas,  would  prove  to  be 
unconstitutional,  and  beyond  the  powers  of  the  colonial 
Parliament,  and  efforts  were  made  to  defy  it  on  that 
ground.  This  attempt  failed,  however,  as  it  was  held 
that  the  power  of  the  colonial  Parliament  was  supreme 
in  all  matters  affecting  its  own  lands.  It  remained  only 
to  abuse  the  Parliament,  and  to  denounce  the  colony, 
as  the  first  to  enter  on  a  course  of  antagonism  to  capital, 
and  unblushing  robbery  of  those  who  had  invested  money 
in  the  country. 

As  for  New  Zealand  it  had  taken  the  first  decisive 
step  in  its  new  policy.  It  had  arrived  at  the  conclu- 
sion that  in  that  young  and  distant  colony  the  interests 
of  the  people,  as  a  whole,  were  henceforward  to  be  the 
first  consideration;  those  of  Capital,  or  business,  or  of 
any  class  of  the  people  more  or  less  representative  of 
one  or  the  other,  were  to  take  a  position  altogether 
secondary.  The  step  had  involved  an  innovation  on 
long  accepted  ideas  of  society,  but  it  had  not  involved 
any  real  injustice  to  anybody.  It  had  denied  the  right 
of  any  individual,  or  body  of  associated  individuals,  to 
use  capital  in  such  a  way  as  to  delay  settlement,  or  to 
inflict  injury  on  the  community  at  large ;  but  it  had 
taken  nothing  from  them  without  compensation,  calcu- 
lated on  the  basis  of  the  full  present  value  of  the  land  of 
which  it  deprived  them.  This  was  New  Zealand's  first 
great  experiment,  and  it  involved  a  principle  which 
meant  more,  and  reached  farther,  than  either  its  sup- 
porters or  opponents  at  the  time  anticipated. 


CHAPTER  III 

INDUSTEIAL  DISPUTES 

The  development  of  every  new  country  necessarily 
begins  with  the  land,  which  has  always  appealed  to  men, 
as  soon  as  they  entered  on  even  the  earliest  stages  of 
civilisation,  as  the  chief  source  of  well-being  for  the 
community.  Other  industries  and  arts  come  later,  but 
the  industry  that  deals  with  the  soil,  and  the  art  of  mak- 
ing it  produce  food  for  its  inhabitants,  always  comes 
first.  Kew  Zealand  was  no  exception  to  this  rule.  Its 
earliest  colonists  had  been  farmers  in  the  old  country, 
or  at  least  had  made  up  their  minds  to  become  farmers 
in  the  new.  The  new  era  of  transportation  had  fairly 
begun  before  the  distant  island  colony  was  founded, 
and  it  was  easy  to  bring  to  the  countr)'-  such  manufac- 
tured goods  as  met  the  simple  needs  of  the  young  com- 
mimity  —  far  more  easy,  at  any  rate,  than  to  manu- 
facture them  on  the  spot.  In  consequence  of  this  the 
first  thirty  years  of  New  Zealand's  settlement  saw  very 
few  attempts  made  to  turn  the  industry  of  its  people  in 
the  direction  of  any  kind  of  associated  labour.  There 
were,  of  course,  carpenters,  blacksmiths,  shoe-makers, 
and  tailors,  almost  from  the  first,  but  these,  and  such 
simple  industrial  arts  as  these,  were  all  the  young  coun- 
try had  to  show  as  manufactures,  and  these  were  prac- 
tised individually  rather  than  in  co-operation. 

71 


T2     SOCIAL  WELFAHE  IN  NEW  ZEALAND 

There  was,  perhaps,  one  exception  in  the  case  of  New 
Zealand.  From  the  first  it  Avas  a  country  that  depended 
almost  entirely  on  the  ocean  for  its  means  of  communi- 
cation between  its  own  settlements.  These  were  scat- 
tered, some  hundreds  of  miles  apart,  along  the  coasts 
of  both  islands,  from  the  extreme  north  to  the  farthest 
south.  The  inland  districts  of  the  south  island  were 
unoccupied,  while  in  the  north  they  were  occupied  by 
semi-savage  tribes,  whose  friendliness  was  at  the  best 
but  doubtful,  so  that  a  coastal  shipping,  and  a  coastal 
trade,  very  soon  sprang  up  and  flourished.  The  ves- 
sels were  small,  indeed,  and  the  crews  small,  and  yet 
the  seamen  of  the  coastal  trade  soon  became  at  once  the 
largest,  and  probably  the  most  united  in  feeling  and 
interests  of  any  industrial  body  in  the  colony.  As  the 
years  went  on  trade  with  the  colonies  of  Australia  in- 
creased, until  by  the  beginning  of  the  last  ten  years  of 
the  last  century  a  large  and  flourishing  trade  had  sprung 
up,  employing  many  vessels,  and  a  large  body  of  sail- 
ors. It  was  in  the  year  1892  that  the  great  organised 
strike  of  workers  in  the  Australian  colonies  took  place, 
in  which  the  Seamen's  Unions  took  a  leading  part.  The 
industrial  crisis  was  not  only  serious  but  very  widely 
spread,  affecting  nearly  every  industry  of  the  country. 
The  universal  strike  of  the  Seamen's  Unions  at  all  the 
ports  paralysed  trade,  and  was  in  some  places,  especially 
in  New  South  Wales,  accompanied  by  serious  riots. 
The  sympathy  existing  between  the  Unions  of  seamen 
in  the  two  countries  caused  a  near  approach  to  a  gen- 
eral strike  of  the  New  Zealand  Seamen's  Unions,  and  for 


INDUSTRIAL  DISPUTES  73 

some  months  trade  was  seriously  disorganised  in  that 
colony. 

Months  of  unrest  and  loss  were  followed  by  a  slow 
resumption  of  work,  and  a  still  slower  recovery  cf  con- 
fidence and  prosperity.  To  the  people  of  New  Zea- 
land, and  their  representatives  in  the  Legislature,  this 
naturally  suggested  the  question  whether,  in  the  interest 
of  tl^e  community  as  a  whole,  it  was  not  possible  to 
find  some  better  way  of  settling  industrial  disputes  than 
that  of  force.  In  Australia  the  question  was  allowed 
to  die  out,  without  any  real  attempt  being  made  to  solve 
the  problem.  The  public,  and  the  public  men  there, 
were  content  to  see  the  return  of  immediate  prosperity, 
and  to  believe  that  in  such  cases  the  best  policy  was  to 
let  well  alone  for  the  time,  and  to  let  the  future  take 
care  of  itself.  The  temper  of  New  Zealand  was  differ- 
ent. Her  people,  and  her  representatives,  had  for 
some  years  been  growing  accustomed  to  facing  and  deal- 
ing with  difficult  problems  affecting  the  future  well-be- 
ing of  the  country  in  relation  to  the  land,  and  it  did  not 
occur  to  them  to  suppose  that  even  the  more  complicated 
problems  of  industrial  life  lay  outside  the  sphere  of 
their  powers  or  duties,  as  the  guardians  of  the  general 
well-being  of  the  people.  It  was  true,  as  they  were 
fully  aware,  that  other  and  older  communities  had 
shrunk  from  any  definite  attempt  to  deal  with  the  large 
and  complicated  questions  arising  out  of  the  relations 
between  employers  and  employes  —  in  other  words  be- 
tween capital  and  labour  —  but  the  fact  did  not  seem 
to  them  a  good  reason  why  no  attempt  should  be  made 


74     SOCIAL  WELFARE  IN  NEW  ZEALAND 

to  find  a  solution  of  the  problem  on  the  smaller  scale, 
and  in  the  simpler  conditions  of  their  own  young  coun- 
try. 

It  was  under  these  circumstances  that  New  Zealand 
entered  on  the  first  of  its  legislative  experiments  that 
dealt  with  questions  of  manifestly  more  than  local  in- 
terest. The  problem,  as  it  presented  itself  to  the  Par- 
liament and  people  may  be  stated  briefly  in  this  way  — 
How  was  it  possible,  in  cases  of  industrial  disputes, 
to  do  practical  justice  to  the  three  sections  of  the  com- 
munity directly  and  vitally  interested  in  the  matter? 
From  their  point  of  view  the  three  parties  were  the 
employers  and  the  persons  employed,  who  were  most 
immediately  concerned  in  the  dispute ;  and  the  general 
public  of  the  community  which,  if  less  directly  was 
quite  as  really  and  vitally  interested  in  a  fair  settle- 
ment of  the  matters  in  dispute.  The  attitude  of  the 
people  of  New 'Zealand  towards  this  question  was  some- 
what unusual,  as  it  refused  to  admit  that  the  interests 
of  any  section  of  the  community  could  possibly  be  so 
far  separated  from  those  of  the  whole  people  as  to 
entitle  them  to  disregard  the  general  welfare  of  the  na- 
tion for  the  purpose  of  obtaining  something  they  be- 
lieved themselves  entitled  to.  On  the  other  hand  they 
were  fully  convinced  that  anything  like  oppression  or 
injustice  must  in  the  long  run  be  even  more  injurious 
to  the  whole  community  than  to  any  section  of  it.  In- 
justice by  employers  to  those  whom  they  employed  must 
create  bad  feeling,  and  a  want  of  the  honest  co-operation 
necessary  to  produce  the  best  results;  an  attempt  to 
compel  the  employers  of  labour  to  grant  demands  that 


INDUSTRIAL  DISPUTES  75 

were  unjust,  because  tbej  appeared  advantageous  to  the 
workers,  bj  the  dislocation  of  commerce  and  industry 
inseparable  from  a  strike,  must,  as  it  seemed  to  the 
people  of  New  Zealand,  result  in  evils  affecting  the 
whole  people. 

It  was  the  recognition  of  the  principle  that  no  section 
of  an  organised  community  or  nation  has,  or  can  have, 
a  right  to  ignore  the  interests  and  well-being  of  the  rest 
of  the  nation  in  seeking  its  own  advantage,  any  more 
than  an  individual  has  such  a  right,  that  led  to  New 
Zealand's  first  experiment  in  industrial  legislation.  A 
strike  might  possibly  in  the  end  repay  the  strikers  for 
the  loss  and  suffering  they  incurred  by  the  concessions 
they  obtained;  a  lock-out  might  possibly  turn  out  a 
good  speculation  for  the  employers,  whose  capital  lay 
idle  for  a  time,  in  case  they  succeeded  in  forcing  lower 
wages  or  longer  hours  of  labour  on  those  whom  they  em- 
ployed ;  the  public  as  a  whole,  had  nothing  to  gain,  but 
everything  to  lose  by  this  modem  substitute  for  the 
private  wars  of  the  Middle  Ages.  It  seemed  to  the 
people  of  the  young  colony  that  the  assertion  that  strikes 
and  lock-outs  were  not  wars  but  a  mere  exercise  of  the 
undoubted  right  of  free  men  either  to  work  or  leave  off 
working  —  either  to  use  or  not  to  use  their  capital  as 
they  thought  fit  —  was  little  better  than  a  hollow  pre- 
tence, which  was  absolutely  disposed  of  by  the  methods 
almost  invariably  employed  by  the  parties. 

Fair-play,  and  justice  between  man  and  man,  and 
between  class  and  class,  had  for  a  good  many  years 
been  the  growing  ideal  of  New  Zealand  legislation ;  and 
this  question  of  industrial  disputes  and  their  settlement, 


76     SOCIAL  WELFAEE  m  NEW  ZEALAND 

seemed  one  sjieciallj  calling  for  legislative  adjustment. 
In  the  past,  and  in  every  part  of  tlie  world,  there  could 
be  no  doubt  that  injustice  had  been  done  and  fair-play 
had  been  denied,  as  a  rule,  to  the  workers  as  a  class; 
this,  like  any  other  form  of  injustice  to  the  individual, 
could  be  more  effectually  remedied  by  law  than  by  per- 
sonal effort,  which  must  almost  inevitably  take  more 
or  less  the  form  of  violence. 

The  New  Zealand  Arbitration  Law  was  the  first  at- 
tempt ever  made  on  anything  like  a  national  scale  to 
ensure  something  like  justice  for  the  workers,  while  at 
the  same  time  it  grappled  with  the  evil  that  had  been 
an  increasing  one  in  every  civilised  country  for  half  a 
century.  It  was  recognised  that  every  form  of  war- 
fare—  whether  between  nations,  classes,  or  individ- 
uals, —  was  in  its  nature  an  appeal  to  force,  and  not 
to  fair-play  or  justice.  The  New  Zealand  law  of  in- 
dustrial arbitration  was  an  attempt  to  introduce  into 
the  region  of  industrial  questions  the  higher  principle 
of  righteousness  —  that  principle  on  which  so  largely 
depends  the  superiority  of  civilised  men  to  the  lower 
animals  who  struggle  blindly  and  fiercely  to  obtain  what 
they  want,  because  they  want  it.  It  was,  in  fact,  an 
appeal  to  the  higher  intelligence,  as  well  as  to  the  com- 
mon-sense both  of  workers  and  employers;  and  it  said 
much  for  the  innate  common-sense  of  tlie  classes  for 
whose  benefit  it  was  in  the  first  place  intended,  that 
they  were  willing  at  least  to  give  it  a  trial. 

The  provisions  of  the  Arbitration  Law  of  New  Zea- 
land have  been  frequently  misrepresented,  either  in- 
tentionally or  through  ignorance,  and  yet  it  is  both  fair 


INDUSTEIAL  DISPUTES  77 

and  simple  beyond  the  example  of  most  statutes.  It 
begins  with  a  full  recognition  of  the  principle  of 
Trades  Unionism,  which  it  makes  use  of  as  the  basis 
of  the  new  law.  It  provides  that  any  Union  contain- 
ing a  certain  number  of  members  —  whether  the  Union 
is  one  of  workers  or  employers  —  may  avail  itself  of 
the  benefits  of  the  statute  by  registering  the  association 
as  one  subject  to  the  provisions  of  the  law.  The  stat- 
ute has  been  denounced  by  its  enemies  as  one  of  com- 
pulsory arbitration,  but  there  is  not,  nor  has  there  ever 
been,  any  suggestion  that  any  Union  should  register 
otherwise  than  of  its  own  free  will.  Associations  may 
even  by  voluntary  registration  render  their  members 
subject  to  the  provisions  of  the  statute,  and  afterwards 
withdraw  their  registration,  by  giving  six  months  no- 
tice of  their  desire  to  do  so;  the  only  compulsory  fea- 
ture of  the  statute  is  that  which  attaches  to  all  the 
laws  of  a  civilised  community,  that  as  long  as  the  as- 
sociation and  its  members  remain  registered  they  shall 
be  subject  to  the  provisions  of  the  statute. 

These  provisions  are  aimed  directly  at  the  preven- 
tion of  industrial  warfare  by  making  it  a  punishable  of- 
fence for  any  body  of  workers  to  leave  off  work  in 
concert,  for  the  purpose  of  compelling  the  employers  in 
any  trade  or  employment  to  agree  to  a  demand  for 
higher  wages,  or  any  other  alteration  in  the  conditions 
of  their  employment.  On  the  other  hand  it  is  equally 
an  offence  against  the  terms  of  the  statute  for  any  as- 
sociation of  employers  to  discontinue  the  employment 
of  their  workers  for  the  purpose  of  compelling  their 
agreement  to  any  change  in  their  rates  of  payment,  in 


78     SOCIAL  WELFARE  IN  NEW  ZEALAND 

their  hours  of  work,  or  to  any  other  proposed  change 
in  the  existing  conditions  of  employment.  Instead  of 
a  resort  either  to  the  strike  or  the  lock-out  the  law  pro- 
vides that  whenever  a  dispute  arises  in  any  trade  in 
which  either  the  workers  or  the  employers  are  regis- 
tered as  an  association  under  the  provisions  of  the  stat- 
ute, either  party  may  at  once  call  in  the  assistance  of 
the  local  Board  of  Conciliation  (for  which  there  has 
by  a  later  amendment  of  the  statute  been  substituted 
public  oflScers  in  each  district  known  as  conciliators), 
whose  duty  it  is  to  meet  the  representatives  of  the  par- 
ties, and  endeavour  by  all  reasonable  means  to  bring 
about  an  agreement  on  the  matters  in  dispute.  In  case 
conciliation  should  prove  ineffectual,  however,  it  be- 
comes the  duty  of  the  conciliator  to  refer  the  question  to 
the  Arbitration  Court  without  delay.  This  court  con- 
sists of  five  members  in  all,  two  of  whom  are  chosen  by 
the  votes  of  the  registered  associations  of  the  workers, 
and  two  by  those  of  the  registered  associations  of  em- 
ployers, while  the  fifth  member  of  the  Court  is  one  of 
the  judges  of  the  Supreme  Court,  who  is  also  Presi- 
dent of  the  Arbitration  Court,  and  is  from  time  to 
time  appointed  by  the  Government  to  this  particular 
office.  The  decisions  of  the  Court  are  declared  by  the 
statute  to  be  final,  and  subject  to  no  appeal,  except  on 
the  single  ground  that  the  question  dealt  with  is  be- 
yond the  powers  given  to  the  Court. 

The  judgments  of  the  Arbitration  Court  may  be  en- 
forced either  by  fines,  levied  on  the  property  of  the 
Associations,  or  of  individual  members;  or  by  im- 
prisonment of  the  oflScers,  or  of  members  of  such  as- 


INDUSTRIAL  DISPUTES  79 

sociations  as  may  be  declared  guilty  of  contempt  of 
the  Arbitration.  Court.  Such  fines  or  imprisonment 
can,  however,  only  be  levied  under  the  authority  of 
the  Supreme  Court  which  must  be  appealed  to  to  en- 
force the  judgment  of  the  Arbitration  Court. 

Such,  very  briefly  stated,  are  the  main  provisions  of 
the  Arbitration  statute  of  ISTew  Zealand  that  was  passed 
by  the  Parliament  in  1893,  and  came  into  force  at  the 
beginning  of  1894.  Its  purpose  was  to  substitute  the 
calm  judgment  of  a  court,  the  members  of  which  might 
be  expected  to  have  a  general  acquaintance  with  the 
questions  likely  to  come  before  them,  and  presided  over 
by  a  judge  accustomed  to  hear  and  weigh  evidence  for 
the  prejudiced  opinions  of  those  whose  interests  were 
directly  at  stake.  It  was  characteristic  of  the  Xew 
Zealand  point  of  view  that  it  took  for  granted  the 
willingness  of  all  classes  of  the  community  to  submit 
to  whatever  was  held  to  be  fair  and  just  by  a  court  of 
this  kind,  rather  than  to  insist  on  fighting  a  battle,  in 
the  hope  of  gaining  what  they  wanted,  without  refer- 
ence to  its  absolute  fairness  to  the  other  side ;  and  ex- 
perience proved  —  not  at  once,  indeed,  but  after  a  short 
delay  —  that  the  makers  of  the  new  law  had  not  been 
too  sanguine. 

Public  opinion  throughout  the  country  was  from  the 
first  favourable  to  giving  the  new  experiment  a  trial; 
the  real  and  important  question  was  how  far  either  em- 
ployers or  Labour  Unions  would  be  disposed  to  place 
themselves  voluntarily  under  the  provisions  of  the  new 
law,  and  the  control  of  the  new  Court.  Por  a  time  the 
question    remained    unanswered.     Por    a    good    many 


80     SOCIAL  WELFAEE  IN"  NEW  ZEALAND 

months  neither  of  the  parties  most  immediately  con- 
cerned seemed  inclined  to  take  the  step,  and  there  were 
a  good  many  critics  both  in  England  and  Australia, 
who  prophesied,  somewhat  contemptuously,  that  it 
never  would  be  tried  at  all. 

These  prophecies,  however,  turned  out  to  be  mis- 
taken. One  Trades  Union,  dissatisfied  with  the  wages 
received  by  its  members,  did  at  last  take  the  step 
of  registering,  and  bringing  the  question  before  the 
Court,  which  was  then  constituted  for  the  first  time. 
The  Court  proceeded  to  issue  a  summons  to  appear 
to  the  employers  complained  of.  The  employers  who 
had  been  summoned,  being  probably  unwilling  to 
treat  the  matter  seriously,  did  not  attend,  leaving 
it  to  the  registered  Union  to  place  their  side  of 
the  disjjute  uncontradicted  before  the  Court,  with  the 
natural  result  that  a  decision  was  come  to,  largely, 
though  not  wholly,  in  accordance  with  the  demands  of 
the  workers.  The  employers  who  were  the  subject  of 
the  order  of  the  Court  soon  discovered  their  mistake, 
and  learned  that  the  only  way  left  them  of  avoiding 
the  consequences  of  their  mistake  was  that  of  retiring 
from  business,  and  paying  whatever  fine  might  be  im- 
posed on  them  by  the  Supreme  Court  for  contempt  of 
the  order  of  the  Court  of  Arbitration, 

The  discovery  that  the  new  law  could  be  made  use 
of  so  effectively  caused  a  sensation  in  the  camps  both  of 
employers  and  workers,  and  led  to  the  rapid  increase  of 
registration  under  the  act  by  Trades  Unions  generally, 
convinced  that  they  could  in  that  way  obtain  justice 
more  certainly,  and  undoubtedly  more  cheaply  than  by 


INDUSTRIAL  DISPUTES  81 

even  the  most  successful  of  strikes.  To  the  employers 
of  labour,  it  need  hardly  be  said,  the  surprise  was  at 
least  equally  great,  and  a  good  deal  more  unpleasant. 
A  refusal  to  obey  the  order  of  the  Court  would  expose 
them  to  a  fine  of  from  $500  to  $2,500  (£100  to  £500), 
at  the  discretion  of  the  Supreme  Court  judge  before 
whom  the  matter  might  be  brought,  while  eveiy  at- 
tempt to  carry  on  business  in  defiance  of  the  terms  of 
the  order  would  constitute  a  fresh  offence,  which  might 
expose  them  to  imprisonment.  On  consideration  the 
employers  who  had  been  the  subjects  of  the  order  in 
the  first  case  decided  to  obey  the  order  of  the  Court, 
and  to  give  the  matter  a  trial,  rather  than  give  up  busi- 
ness in  the  colony,  and  at  the  same  time  incur  a  more 
or  less  heavy  fine  for  contempt. 

So  far  the  result  had  been  merely  a  surprise  to  critics 
of  the  new  legislation  outside  the  colony.  They  were 
absolutely  united  in  the  opinion  that  the  new  law  must 
necessarily  prove  a  failure;  they  were  almost  equally 
unanimous  in  their  amused  contempt  for  the  young 
community  that  believed  itself  wiser  than  the  people  of 
older  and  more  populous  countries,  as  well  as  of  the  con- 
clusions of  political  economists  in  all  parts  of  the  worid. 
ISTo  critics  were  more  severe  than  those  of  the  near- 
est neighbours  of  JSTew  Zealand,  and  for  more  than  a 
year  after  the  first  case  came  before  the  new  Court  the 
Australian  newspapers  were  full  of  reports  and  criti- 
cisms of  the  new  experiment  of  their  island  neighbour. 
The  English  papers  and  magazines  of  special  authority 
on  questions  of  commerce  and  finance  took,  as  a  rule, 
a  very  serious  view  of  the  effect  which  this  new  ex- 


82     SOCIAL  WELFAEE  I^  NEW  ZEALAND 

periment  was  likely  to  have  on  the  future  of  New  Zea- 
land. If  industry,  and  the  operations  of  capital  as 
applied  to  organised  industrial  enterprises,  were  to  be 
hampered  by  the  interference  of  an  arbitrary  court 
which  could  fix  the  scale  of  wages,  not  on  the  old  basis 
of  supply  and  demand,  but  on  some  fanciful  basis  of 
fairness  to  the  worker,  and  the  profits  of  the  employers, 
there  was,  they  concluded,  an  end  of  all  commercial 
and  industrial  development.  New  Zealand,  they  re- 
minded their  readers,  had  already  entered  on  a  policy 
of  over-taxing,  and  even  of  confiscating  large  estates  in 
land,  and  now  the  foolish  young  community  was  pro- 
ceeding to  drive  the  capital  invested  in  manufacturing 
enterprises  out  of  the  country;  it  was  clear,  they  were 
all  agreed,  that  the  end  of  the  colony's  prosperity 
couldn't  be  far  distant.  Capital  would,  of  course,  be 
withdrawn  from  the  suicidal  young  country,  and  those 
would  be  the  most  lucky  who  withdrew  it  at  once,  and 
with  the  least  loss. 

And  for  a  time  these  persistent  criticisms  were  not 
without  an  effect.  New  Zealand  loans  were  discredited 
on  the  English  money  market,  and  the  value  of  New 
Zealand  stocks  was  depreciated.  Manufacturers  who 
had  begun  business  in  the  coimtry,  hesitated  to  extend 
it,  or  to  invest  more  capital  in  a  country  that  had  en- 
tered on  so  rash  and  foolish  a  policy  of  giving  way  to 
the  demands  of  the  workers,  and  ignoring  the  claims 
of  capital.  Trade  can  hardly  be  said  to  have  lan- 
guished seriously,  perhaps,  but  for  one  or  two  years 
something  like  stagnation  prevailed,  owing  to  the  un- 
willingness of  people,  either  in  the  colony  or  beyond  it, 


INDUSTEIAL  DISPUTES  83 

who  had  a  little  money  to  invest  to  risk  it  in  opposition 
to  the  "universal  opinions  of  experts.  This  state  of 
things,  however,  lasted  onlj  a  short  time,  and  very  soon 
the  feeling  of  alarm  began  to  die  away.  The  with- 
drawal of  capital  that  had  been  so  confidently  predicted 
had  not  apparently  taken  place,  and  within  the  colony 
itself  matters  appeared  to  go  on  at  least  as  well  as  be- 
fore,—  showing  that  the  people  on  the  spot  felt  little 
or  no  alarm.  More  and  more  of  the  Unions  registered 
as  Associations  under  the  statute,  and  some  of  the  em- 
ployers had  begun  to  form  associations  as  Unions  of 
employers,  for  registration  under  the  law.  Cases  of 
dispute  were  referred  to  the  Court,  more  and  more  as 
a  matter  of  course,  and  employers  as  well  as  workers 
began  to  arrive  at  the  conclusion  that  even  if  the  deci- 
sion of  the  Court  seldom  gave  either  party  all  it  wanted, 
the  result  was  better  for  both  than  the  dislocation 
of  industry  inseparable  from  a  strike  or  a  lockout. 
Employers,  whether  carrying  on  business  as  indi- 
viduals or  companies,  on  the  spot,  grumbled  and  com- 
plained of  the  injustice  done  them  by  the  law;  but  in 
the  end  they  decided  to  go  on  with  business  as  before 
—  to  pay  the  wages  prescribed,  and  to  ask  fewer  hours 
of  work  in  each  week  than  before  of  those  they  em- 
ployed, in  accordance  with  the  awards  of  the  Court; 
and  before  the  arbitration  law  had  been  two  years  in 
force  there  was  a  general  increase  of  prosperity  among 
the  people,  while  nobody  seemed  to  be  ruined  in  the 
ranks  of  the  employers. 

The  methods  by  which  the  IsTew  Zealand  Arbitra- 
tion Court  has  arrived  at  its  conclusions  are  probably 


84     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

without  precedent  in  the  history  of  modern  commercial- 
ism, and  it  was  only  natural  that,  especially  at  first, 
they  should  have  been  resented  by  the  class  that  by  long 
habit  had  been  taught  to  look  on  all  that  capital  could 
get  from  the  necessities  of  the  class  of  workers  as  some- 
thing that  belonged  to  themselves  by  a  right  more  un- 
questionable than  the  so-called  Divine  right  of  kings 
in  times  gone  by.  The  first  duty  of  the  Arbitration 
Court  in  all  cases  where  the  amount  of  wages  that 
ought  to  be  paid  in  any  particular  trade  was  in  dispute, 
was  to  ascertain  what  it  should  cost  the  average  worker, 
with  a  wife  and  family,  to  live  in  reasonable  comfort 
and  respectability.  The  second  duty  of  the  Court  was 
to  ascertain  how  much  the  profits  of  the  employer  in  an 
ordinary  year  would  enable  them  to  pay.  The  first 
question  was  one  of  national  policy,  as  it  was  held  to 
be  contrary  to  the  interest,  as  well  as  the  duty  of  the 
community,  to  allow  the  degradation  of  any  section  of 
the  people  by  their  employment  on  terms  that  forbade 
their  well-being,  and  that  of  their  families.  The 
second  question  was  one  of  fair-play  and  ordinary  jus- 
tice, as  between  man  and  man ;  and  to  form  a  fair  and 
intelligent  conclusion  it  was  necessary  to  learn  a  good 
many  things  that  had  been  regarded  in  the  past  as  the 
business  of  the  employers,  and  of  nobody  else.  The  es- 
sential principle  of  the  arbitration  law  of  New  Zealand 
entirely  contradicted  this  assimiption.  The  employ- 
ers of  labour  were  only  one,  and  in  numbers  very  much 
the  smallest  one,  of  three  classes  which  together  formed 
the  community.  Erom  the  point  of  \aew  of  the  New 
Zealand  statute  they  had  certainly  no  greater  interest 


INDUSTRIAL  DISPUTES  85 

in  tlie  question  of  the  profits  of  the  trade  than  the 
workers  by  whose  exertions  profit  was  rendered  possible, 
and  even  less  than  that  of  the  community  at  large, 
whose  duty  as  well  as  interest  it  was  to  see  justice  done 
to  every  class  of  its  people. 

It  may  be  said  that  the  answer  to  the  question  of 
the  amount  of  wages  needed  to  secure  a  decent  living 
for  the  workers  and  their  families  was,  after  all,  a 
matter  of  opinion,  and  possibly  even  of  prejudice. 
What,  it  might  be  asked,  is  a  sufficient  and  decent  liv- 
ing? And  the  answer  would  largely  depend  on  the 
prejudices  of  the  person  who  was  to  answer.  For- 
tunately there  was  in  ISTew  Zealand,  as,  indeed,  there 
is  probably  in  every  country  a  court  of  appeal  on  mat- 
ters of  opinion  that  may  generally  be  trusted  to  take  a 
view  of  such  questions  that  is  tolerably  fair.  The  New 
Zealand  statute  had  provided  for  such  an  appeal,  by 
providing  that  the  proceedings  of  the  Arbitration  Court 
should  in  all  cases  be  conducted  in  public,  so  that  the 
evidence  given  should  in  all  cases  be  open  to  the  press 
and  known  to  the  people.  In  different  communities,  it 
is  true  the  public  opinion  thus  formed  might  differ 
considerably ;  but  in  every  country,  it  may  be  said  with 
confidence,  the  opinion  thus  formed  would  exercise  a 
powerful  influence  on  a  court  of  arbitration.  In  New 
Zealand  the  ideal  of  a  sufficient  and  decent  livelihood 
was  probably  as  high  as  in  any  country  in  the  applica- 
tion of  the  terms  to  the  class  of  workers  in  any  trade 
or  calling,  and  this  practically  fi:xed  the  standard  of  the 
lowest  living  wage  on  a  high  scale  compared  with  the 
cost  of  the  necessaries  of  life  for  a  family.     What  the 


86     SOCIAL  WELPAEE  i:^^  NEW  ZEALAND 

Court  had  to  do  therefore,  in  cases  in  which  questions 
of  the  rate  of  wages  was  at  stake,  was  in  the 
first  place  to  decide  on  the  lowest  reasonable  living  wage 
—  and  this  was  practically  the  same  in  every  trade  or 
employment.  This  lowest  living  standard  as  it  did  not 
depend  on  the  profits  of  the  business,  was  not  affected 
by  the  question  either  of  capital  invested,  or  of  the 
conditions  of  the  trade.  If  employers  could  not  af- 
ford to  pay  wages  at  the  rate  that  was  decided  on  as 
the  lowest  on  which  workers  could  live  decently,  it 
was  evident  that  for  some  reason  the  business  was  one 
that  should  not  be  carried  on,  and  no  arguments  based 
on  the  claims  of  capital  to  consideration  could  be 
listened  to  as  affecting  the  question. 

The  question  of  the  minimum  wage,  however,  was 
only  a  part,  and  a  small  part,  of  the  problem  with 
which  the  Arbitration  Court  had  to  deal.  While  it 
was  clear  that  nobody  could  be  allowed  to  pay  less  than 
a  living  wage  to  those  employed,  the  question  of  jus- 
tice demanded  a  good  deal  more  than  this  before  it 
could  be  said  to  be  fairly  settled.  The  old  idea  that 
the  man  who  found  the  money  should  have  everything, 
and  the  men  who  found  the  labour  as  little  as  possible, 
had  been  abandoned  in  New  Zealand;  the  problem 
which  the  Court  had  to  solve  was  the  somewhat  in- 
definite one  —  what  was  fair.  To  enable  this  to  be 
done  the  law  provided  that  the  Court  might  call  on  the 
employers  in  any  dispute  as  to  wages,  to  produce  the 
books  containing  the  accounts  of  their  business,  and 
to  show  exactly  what  capital  was  invested  in  it,  and 


INDUSTEIAL  DISPUTES  87 

.what  profits  liad  been  earned.  The  task  of  the  Court 
was  by  no  means  an  easy  one.  Even  when  the  books  of 
a  business  had  been  produced,  and  the  capital  invested, 
and  the  profits  made  had  been  ascertained,  the  ques- 
tion remained  what  ought  the  employers  to  give  out 
of  the  profits  to  the  workers,  without  whose  assistance 
no  profits  could  have  been  earned  ?  What,  as  a  matter 
of  fact,  the  Arbitration  Court  of  New  Zealand  has 
done  during  the  sixteen  years  of  its  existence  has  been 
to  come  to  some  conclusion  that  seemed  fair  in  each 
case.  The  principle  of  a  real  partnership  has  been  ac- 
knowledged by  the  Court^  but  the  shares  due  to  the 
partners  have  been  matters  of  opinion,  and  the  awards 
of  the  Court  have  as  a  consequence,  always  been  open  to 
criticism  by  one  or  other  party  to  the  dispute. 

There  have  been  many  such  criticisms,  both  in  the 
colony  itself  and  elsewhere;  but  as  a  rule  the  parties 
most  nearly  concerned  have  admitted  that  the  decisions 
of  the  Court  were  conceived  in  a  spirit  of  fair-play  as 
between  the  parties.  This,  it  may  be  pointed  out  was 
the  object  with  which  the  law  was  originally  passed, 
and  the  farther  step,  of  laying  down  a  definite  pro- 
portion in  which  Labour  and  Capital  should  share,  had 
not  been  contemplated.  The  law  has  now  been  in  force 
during  sixteen  years,  and  it  has  been  accepted  by  both 
employers  and  employed  as  the  controlling  force  of  the 
industrial  life  of  nearly  a  million  people  of  our  own 
race.  Amendments  have  from  time  to  time  been  made 
in  the  law,  as  new  features  have  appeared  that  seemed 
to  call  for  regulation ;  but  in  all  essentials  the  law  thait 


88     SOCIAL  WELFAEE  m  NEW  ZEALAND 

was  conceived  in  a  spirit  of  fair-play  and  justice  — 
recognising  equally  the  rights  of  Labour,  Capital,  and 
of  the  people  at  large,  sixteen  years  ago,  remains  in 
force  to-day,  and,  like  all  the  other  laws  of  New  Zea- 
land is  enforced  without  fear  or  favour. 


CHAPTEE  ly 

THE  EEGULATION   OF  LABOUE 

The  settlement  of  industrial  disputes  by  a  court  of 
unprejudiced  judges  was  a  great  step  towards  well- 
being,  but  it  was  very  far  from  being  all  that  was 
needed.  The  well-being,  or  in  a  more  familiar  form 
the  "wealth,"  of  the  people  as  a  whole,  and  of  every 
one  of  the  deserving  members  of  the  commimity  in  par- 
ticular, being  the  ideal  of  the  State  Socialism  which 
was  more  and  more  becoming  that  of  New  Zealand  and 
its  people,  it  was  not  enough  to  provide  a  cure  in  cases 
where  prevention  was  possible.  Industrial  disputes,  it 
was  recognised,  were  as  a  rule,  the  result  of  the  unjust 
social  and  industrial  conditions  that  had  been  handed 
down  through  long  ages  of  semi-barbarism.  The 
spread  of  knowledge  had,  it  was  felt,  been  opening  the 
eyes  of  the  workers  in  every  civilised  country  to  the 
fact  that  custom  and  prejudice  had  condemned  them  to 
lead  lives  that  were  not  worth  living  —  lives  deprived 
of  rest,  of  happiness,  and  of  enjoyment  —  and  as  long 
as  this  lasted  it  was  certain  there  would  be  unrest,  and 
struggle  after  something  better.  It  was  not  enough, 
therefore,  to  provide  a  court  to  deal  with  the  disputes 
that  were  sure  to  arise  between  employers  and  em- 
ployed; some  effort  must  be  made  to  remove  the  causes 

8^ 


90     SOCIAL  WELFAEE  m  NEW  ZEALAND 

that  must  and  would  lead  to  such  disputes.  A  court  of 
arbitration  might  do  a  good  deal;  it  could  not  be  ex- 
pected to  lay  down  laws  for  the  regulation  of  labour  in 
the  country. 

The  Labour  statutes  of  New  Zealand  were  the  result 
of  this  conviction.  Like  all,  or  nearly  all,  the  revolu- 
tionary legislation  of  the  country,  so  much  criticised, 
and  so  persistently  misrepresented  by  persons  more  or 
less  directly  interested  in  such  misrepresentation,  the 
Labour  legislation  was  not  hastily  undertaken  or  enacted 
in  a  cut  and  dried  form.  On  the  contrary,  the  statutes 
passed  by  the  Parliament  in  any  one  year  usually  dealt 
with  little  more  than  a  single  reform;  and  it  was  gen- 
erally after  one  or  two  years'  experience  had  shown  how 
it  succeeded  that  it  was  added  to  or  amended.  It  need 
hardly  be  said  that  these  Labour  statutes  were  not  popu- 
lar with  employers  on  the  spot,  or  with  the  representa- 
tives of  the  economy  of  commercialism  at  a  distance. 

The  earliest  proposals  made  to  fix  the  hours  of 
labour  were,  of  course,  denounced  as  further  attempts  to 
rob  the  employers;  and  laughed  at,  as  short-sighted 
schemes  that  must  inevitably  fall  back  upon  and  crush 
the  greedy  workers  who  hoped  to  get  a  large  day's  pay 
for  three-quarters  of  a  day's  work.  In  the  country  it- 
self employers  said  it  was  impossible  to  pay  wages  at 
a  high  rate  for  a  week's  work  that  only  extended  to 
forty-four  hours  in  all;  critics  at  a  distance  predicted 
that  the  young  industries  of  the  colony  would  die  a 
natural  death  in  less  than  a  twelvemonth.  It  was,  they 
said,  as  certain  as  any  demonstration  in  mathematics 
that  the  effect  of  giving  men  fuU  wages  for  doing  five 


I 


THE  EEGULATIOiT  OF  LABOUR         91 

and  a  lialf  short  days'  work  in  each  week,  and  paying 
them  besides  for  a  good  many  public  holidays  in  each 
year,  when  they  didn't  work  at  all,  must  be  to  make 
them  idle  and  useless  at  other  times. 

The  view  of  the  legislators  of  'New  Zealand,  however, 
was  different.  The  old  ideas  that  had  prevailed  thr-ough 
so  many  centuries,  by  which  the  power  of  money,  and 
the  advantage  of  the  men  who  had  money,  were 
the  things  to  be  considered  in  law-making,  and  the 
conditions  of  those  who  had  no  money  were  to  be  left 
to  take  care  of  themselves,  did  not  appeal  to  them  as 
either  Christian  or  common-sense.  The  workers,  like 
the  employers  of  the  community,  seemed  to  them  to  be 
equally  human  beings,  and  the  rest,  tlie  enjoyment,  and 
the  happiness  of  life  that  agi'eed  so  well  with  the  peo- 
ple who  had  money,  witliout  making  them  lazy  or  use- 
less might,  after  all,  have  no  very  bad  effect  on  the 
workers.  It  seemed  at  least  possible  that  men  would 
work  better,  and  even  faster,  during  a  day  of  eight 
hours  than  they  would  in  a  day  of  ten  or  twelve;  and 
that  one  half  day  in  each  week  for  rest  and  enjoyment, 
might  be  expected  to  make  better  and  stronger  men  and 
assuredly  better  citizens,  than  the  constant  strain  of 
toil,  that  never  stopped  except  on  the  Sunday,  when 
most  of  the  ordinary  avenues  of  pleasure  were  closed. 
The  threats  of  national  ruin,  so  freely  used  frightened 
them  a  good  deal  less  than  they  had  done  when  they 
had  ventured  to  interfere  with  the  time-honoured  and 
sacred  rights  of  the  great  landholders.  Experience  had 
already  showm  that  the  dreadful  results  prophesied 
then  had  been  no  more  than  Bogies  that  had  turned  out 


92     SOCIAL  WELFAEE  i:^^  NEW  ZEALAND 

harmless;  the  same  might  very  easily  be  the  case  with 
the  labour  bogy  also  —  at  any  rate  they  decided  to  see 
for  themselves. 

The  subject  of  labour  conditions  naturally  divided  it- 
self into  three  general  divisions.  Labour  as  it  affected 
the  young  —  as  it  applied  to  the  case  of  women,  and, 
of  course,  as  it  related  to  the  mass  of  the  working  men. 
The  protection  and  development  of  the  young  received 
early  attention  as  the  starting  point  of  any  real  social 
reform  for  a  nation.  The  education  system,  which  had 
been  in  force  since  1876  was  an  unusually  complete 
one,  extending  as  a  State  institution,  from  the  earliest 
Public  School  instruction,  available  for  children  from 
five  years  of  age,  through  High  School  courses,  includ- 
ing technical  training  schools,  up  to  a  College  career, 
ending  in  University  degrees  in  arts  and  science 
courses.  The  law  made  attendance  compulsory  during 
the  Public  School  course,  which  ended  at  the  age  of  14 
years,  parents  or  guardians  being  liable  to  fines  for  the 
non-attendance  of  children  except  in  cases  of  sickness ; 
but  the  question  of  attendance  at  the  High  School 
course  was  left  to  the  determination  of  the  parents.  In 
the  twenty  years  that  have  passed  since  the  establish- 
ment of  the  education  system  many  new  industries 
had  sprung  up  in  the  cities,  and  there  was  a  demand  for 
both  boys  and  girls  to  work  at  various  trades  at  wages 
that  seemed  desirable  to  many  families.  This  had  un- 
doubtedly interfered  with  the  more  advanced  educa- 
tion of  many  children  who  had  reached  the  age  of 
fourteen ;  and  the  further,  and  even  more  important 
question  had  arisen  how  far  it  was  advisable,  with  a 


THE  EEGULATION  OF  LABOUR  93 

view  to  the  physical  development  of  the  rising  genera- 
tion, that  work  in  factories  and  workshops  should  be- 
gin at  so  early  an  age. 

The  result  of  investigation  was  to  convince  the  rep- 
resentatives of  the  people  in  Parliament  that  fourteen 
was  too  early  an  age  to  shut  up  young  people  in  mills 
and  factories,  if  the  race  were  to  be  developed  at  its 
best,  and  a  new  law  was  passed  which  forbade  the  em- 
ployment in  mills,  factories,  or  workshops  of  boys 
under  the  full  age  of  sixteen,  and  of  girls  under  that 
of  eighteen  years.  Even  then  very  special  provisions 
were  made  for  the  frequent  inspection  of  all  such  places 
with  a  view  to  securing  their  perfect  conformity  to 
sanitary  conditions,  as  well  as  to  the  safety  of  the 
workers.  This  law,  as  a  matter  of  course,  interfered  to 
some  extent  with  the  arrangements  of  the  employers, 
and  many  complaints  were  made,  especially  as  the  new 
statute  provided  for  a  minimum  wage  to  be  paid  to 
apprentices  at  any  trade.  That  it  did  interfere  with 
trade  in  a  country  where  the  supply  of  labour  was 
scarce  there  could  be  no  doubt;  the  answer,  however, 
to  all  such  objections  was  the  same  —  trade,  or  money- 
making,  could  not  be  considered  at  all  in  comparison 
with  the  well-being  of  the  people.  If  any  trade  could 
not  be  carried  on  successfully  without  the  help  of  boys 
and  girls  under  the  age  that  appeared  safe,  then  it 
ought  not  to  be  carried  on  at  all,  and  it  certainly  should 
not  be  carried  on  in  Xew  Zealand.  This  was  the  rea- 
soning of  the  law-makers,  and  the  new  statute  was 
passed,  and  has  ever  since  been  rigidly  enforced.  Boys 
may  be  employed  in  any  healthy  out-of-doors  employ- 


94     SOCIAL  WELPAEE  I^  NEW  ZEALAKD 

ment  at  any  time  after  fourteen,  and  girls  may  either 
be  so  employed,  or  may  become  engaged  in  house- 
hold work,  or  in  the  care  of  infants  at  sixteen ;  the  use 
of  such  young  people  in  mills,  factories,  or  workshops, 
has  now  been  forbidden  by  law  for  a  good  many  years, 
and  the  law  has  been  rigidly  enforced.  Many  attempts 
have  been  made  to  evade  the  law,  of  course,  but  it  may 
safely  be  said  that  they  have  very  rarely  succeeded. 
This  has  undoubtedly  been  largely  owing  to  the  as- 
sistance of  the  Trades  Unions,  which  from  the  first 
have  strongly  supported  the  law,  possibly  —  as  has 
often  been  suggested  —  with  a  view  to  keeping  up  the 
standard  of  wages  for  people  of  full  age.  Whatever 
the  reason  may  have  been,  the  statute  has  been  effective 
for  the  purpose  for  which  it  was  designed.  There  are 
no  boys  under  sixteen,  or  girls  under  eighteen  now 
working  in  workshops,  factories  or  mills  in  ISTew  Zea- 
land. The  consequence  has  been  that  many  have  left 
the  cities  to  become  farmers,  and  many  more  of  both 
sexes,  have  gone  to  the  State  High  Schools  to  obtain 
a  higher  education  than  they  could  otherwise  have 
hoped  for. 

Among  the  things  that  go  to  make  up  human  well- 
being  modem  science  declares  that  few,  if  any,  are 
more  important  than  sufficient  relaxation  from  labour, 
and  a  reasonable  amount  of  pleasure  for  the  individual. 
The  object  of  any  system  of  State  Socialism,  being 
frankly  that  of  making  the  best  of  life  for  all  classes 
of  the  people,  it  is  evident  that  it  must  deal  in  some 
way  with  the  hours  of  labour  and  of  rest,  of  toil  and  of 
pleasure,  allotted  to  the  workers.     The  New  Zealand 


THE  EEGULATION  OF  LABOUR         95 

law  has  not  hesitated  to  deal  with  that  which  elsewhere 
has  been  looked  on  as  too  delicate  and  difficult  a  ques- 
tion to  be  regulated  bj  any  rules  of  general  applica- 
tion. It  is  true  that  any  such  general  regulation  might 
be  objected  to  on  the  ground  that  it  would  injuri- 
ously affect  some  trades,  and  very  seriously  embarrass 
others,  even  if  it  could  be  submitted  to  without  any 
greater  difficulty  than  that  involved  in  setting  a  sharp 
limit  to  the  powers  of  the  employer.  The  principle 
recognised  as  the  governing  one  in  ISTew  Zealand's  sys- 
tem of  social  legislation  took  little  notice  of  difficulties 
of  this  kind.  The  question  to  be  settled  was  what  was 
for  the  advantage  of  the  people;  not  what  would  give 
the  employers  the  largest  returns  for  the  capital  em- 
ployed in  their  business.  Having  decided  that  eight 
hours  out  of  twenty-four  were  a  sufficient  day's  work, 
it  went  on  to  provide  for  some  part  of  each  week  in 
which  the  workers  might  have  the  opportunity  for  en- 
joyment. The  result  was  that  Saturday  in  each  week 
was  fixed  on  as  the  day  on  which  four  hours  should 
count  as  a  full  day's  work  for  which  payment  should 
be  made  to  all  persons  employed  by  the  week  at  the 
same  rate  as  the  other  days.  At  twelve  o'clock  on 
Saturday,  therefore,  all  labour  lays  down  its  tools,  ex- 
cept in  cases  where  another  half  day  has  by  arrange- 
ment been  substituted,  and  the  Saturday  afternoon 
and  evening  become  the  play-time  of  the  workers  and 
their  families.  Saturday  night  shoping  is  provided  for 
by  a  clause  which  leaves  it  to  the  local  authorities  of 
every  city  or  borough  to  select  any  other  day  in  each 
week  on  which  shops  and  stores  shall  be  closed  at  mid- 


96     SOCIAL  WELFARE  IN  NEW  ZEALAND 

daj  that  all  the  employes  may  have  their  half  holiday. 
Six  o'clock  is  the  statutory  hour  at  which  stores  and 
shops  must  close,  except  on  Saturdays  when  they  may 
remain  open  till  nine,  but  without  extending  the  hours 
constituting  a  week's  work  for  those  employed.  The 
only  exception  made  as  to  closing  hours  is  in  the  case 
of  shops  and  restaurants  devoted  to  the  sale  of  food, 
which  includes  fruits,  vegetables,  and  curiously  enough 
tobacco;  but  this  does  not  authorise  the  employment  of 
wage  earners  for  more  than  the  forty-four  hours  in 
each  week  prescribed  by  the  statute.  The  rates  of 
wages  are  not  dealt  with  by  the  statute,  the  Arbitration 
Court  being  specially  empowered  to  fix  these  for  each 
trade  on  application. 

There  are  a  good  many  statutory  holidays  provided 
for  by  the  law  amounting  to  about  one  in  each  month, 
in  conamemoration  of  different  events,  and  all  em- 
ployers are  bound  to  allow  these  to  their  employes  with- 
out any  reduction  in  wages  in  the  case  of  persons  who 
are  employed  by  the  week  or  any  longer  period.  Per- 
sons employed  may,  however,  work  on  holidays,  and 
also  to  the  extent  of  seven  hours  beyond  the  fixed  hours 
in  any  week,  on  the  condition  that  wages  are  paid  for 
the  extra  time  at  the  rate  of  fifty  per  cent,  beyond  the 
regular  rates.  The  Arbitration  Court  has  laid  it  down 
as  a  rule,  however,  that  no  employe  can  be  dismissed  for 
refusing  to  work  beyond  the  regular  hours  under  any 
circumstances. 

Every  employer  of  labour  is  made  by  the  law  respon- 
sible for  injury  received  by  any  worker  during  the 
time  that  he  is  employed,  and  this  includes  the  pay- 


THE  REGULATION  OF  LABOUR  97 

ment  of  half  wages  for  a  certain  number  of  weeks, 
should  disablement  last  so  long,  as  well  as  the  cost  of 
medical  attendance.  In  cases  of  disablement,  such  as 
that  caused  bj  the  loss  of  a  hand,  or  part  of  a  hand, 
the  law  provides  a  scale  of  compensation  in  proportion 
to  the  wages  of  the  worker  injured,  and  in  case  of 
death  by  any  such  accident,  compensation  at  the  rate 
of  a  full  year's  wages  becomes  payable  to  his  family  — ■ 
which  includes,  in  case  the  sufferer  is  unmarried,  any 
parent,  wholly,  or  partly  dependent  for  support  on  the 
person  killed.  In  certain  trades  or  employments  the 
conditions  of  which  are  declared  by  the  statute  danger- 
ous to  health,  the  provisions  relating  to  accidents  are 
extended  so  as  to  cover  death  or  disablement  by  the 
special  diseases  to  which  the  employment  renders  the 
workers  liable. 

The  wide  responsibility  of  employers  naturally  led 
to  a  general  use  of  insurance  against  accidents,  and  the 
companies  doing  business  in  the  country  demanded 
high  rates  of  premium  to  meet  the  large  compensation 
provided  by  the  statute.  As  these  advanced  premiums 
appeared  to  be  in  excess  of  the  added  risk  the  Govern- 
ment added  an  Accident  branch  to  the  Public  Life 
Insurance  department  which  had  been  in  successful 
operation  for  a  good  many  years.  The  new  department 
offered  to  insure  workers  against  accident  on  consider- 
ably lower  terms  than  those  agreed  upon  by  the  regular 
insurance  companies.  The  result  was  that  after  a 
short  time  the  associated  Insurance  Companies  saw 
their  way  to  reduce  their  premiimis  to  the  Government 
standard.     The  reduced  premiums  have  now  been  sev- 


98     SOCIAL  WELFARE  11^^  NEW  ZEALAND 

eral  years  in  operation,  and  do  not  seem  to  have  en- 
tailed the  losses  on  the  companies  they  anticipated. 

By  such  means  as  these  —  not  attempted  all  at  once, 
but  by  a  succession  of  statutes,  introduced  or  amended 
year  after  year,  as  experience  seemed  to  suggest  — 
New  Zealand  has  attempted,  and  to  a  very  large  ex- 
tent succeeded  in  accomplishing  the  regulation  of  labour 
conditions,  on  a  basis  that  may  be  said  to  have  been 
entirely  new.  Wages,  which  have  in  other  countries, 
and  formerly  in  New  Zealand  itself,  been  arrived  at  on 
the  principle  of  supply  and  demand  —  or  in  other 
words  that  of  employment  given  to  the  workers  who 
would  accept  the  lowest  wages  — ■  and  refused  to  those 
who  were  anxious  for  a  little  well-being  for  themselves 
and  families,  and  therefore  asked  for  more  than  would 
barely  support  them  —  have  now  for  sixteen  years  been 
fixed  by  an  independent  Court  on  the  principle  of  fair- 
play  to  both  parties.  The  days  and  hours  of  labour 
have  been  fixed  by  law,  and  provision  has  been  made 
for  the  reasonable  rest  and  recreation  of  that  part 
of  the  community  which  forms  the  large  majority  of  its 
members.  Finally  —  and  not  least  important  —  the 
younger  generation  —  the  boys  and  girls,  with  whom  is 
to  lie  the  future  of  the  country  and  its  people  —  have 
been  protected  from  the  possible  selfishness  of  parents 
and  guardians,  as  well  as  from  the  almost  inevitable 
selfishness  of  employers,  by  forbidding,  under  severe 
penalties,  the  employment  in  workshops,  mills,  or  fac- 
tories, of  any  boy  under  sixteen  or  any  girl  under 
eighteen  years  of  age. 


CHAPTER  V, 

OLD  AGE  PENSIONS 

When  the  legislators  of  New  Zealand  undertook  the 
task  of  reforming  and  regulating  the  conditions  of 
labour  they  were  fully  aware  that  the  undertaking  was 
a  serious  one.  They  were  not  ignorant  of  the  fact 
that  what  they  were  doing  would  arouse  a  strong  prej- 
udice, not  only  in  England  but  in  every  other  civilised 
country  with  which  they  had  commercial  relations,  and 
that  all  would  look  with  more  or  less  suspicion  on  the 
financial  prospects  of  their  country.  All  this  they  had 
deliberately  chosen  to  risk  in  the  attempt  to  realise  an 
ideal  policy  for  the  well-being  of  their  own  people. 
There  was,  however,  one  feature  of  the  case  in  relation 
to  the  regulation  of  labour,  and  its  relations  to  capital, 
that  had  not  been  considered  when  they  undertook  to  fix 
the  hours  of  work,  and  the  rates  of  wages  payable  to 
the  workers. 

The  arbitration  law  was  founded  on  the  idea  of 
unionism  on  the  part  both  of  employers  and  workers, 
and  from  the  first  the  Court  insisted  on  a  preference  be- 
ing given  to  the  members  of  Trades  Unions  that  were 
registered  under  the  act,  and  submitted  to  the  jurisdic- 
tion of  the  Court.  It  made  no  attempt,  however,  to  go 
farther  than  this.     !No  employer  was  compelled  to  em- 


100     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

ploj  labour  lie  didn't  want,  or  to  retain  workers  in  his 
employ  when  he  had  ceased  to  need  their  services.  The 
new  law  had  not  been  long  in  force  before  it  was  found 
that  for  some  at  least  of  the  workers  it  had  another, 
and  a  less  agreeable  side.  As  soon  as  trade  disputes  af- 
fecting the  rate  of  wages  began  to  come  before  the 
Court  it  became  evident  that  the  awards  made  must 
take  the  form  of  fixing  the  rates  payable  in  each  par- 
ticular trade,  at  least  for  some  definite  time.  In  this 
way  the  employers  found  themselves  compelled  to  pay 
wages  —  generally  higher  than  before  —  for  shorter 
hours  of  work,  including  holidays  on  which  no  work  at 
all  was  done.  Most  of  them  decided  reluctantly  to 
give  the  new  conditions  a  trial.  They  would  at  least 
know  what  they  would  have  to  pay,  and  they  would  not 
be  in  danger  of  being  tied  up  by  a  strike  after  they  had 
accepted  a  contract.  One  thing  was  evident,  however 
—  they  must  see  that  they  got  as  much  as  possible  out 
of  the  workers  they  employed  for  shorter  hours,  at 
higher  wages.  It  necessarily  became  a  case  of  employ- 
ing none  but  the  most  competent  hands.  There  was 
no  room  for  the  second-rate  workman,  and  if  possible 
even  less  for  the  man  who  was  too  old  to  do  a  full  day's 
work.  Eor  the  incompetent  worker  at  any  trade  the 
industrial  statutes  could  evidently  do  little  or  nothing, 
but  the  case  of  the  aged  and  infirm  was  different.  It 
had  been  admitted  in  all  countries  of  Anglo-Saxon  civi- 
lisation for  a  good  many  generations  that  the  State 
must  in  some  way,  and  to  some  extent,  provide  for 
the  life,  if  not  for  the  well-being  of  the  aged  poor. 
The  result  had  been  a  poor  one,  indeed,  but  at  least  it 


OLD  AGE  PENSIONS  101 

had  amounted  either  to  a  confession  of  public  duty  or 
to  an  admission  of  public  advantage.  The  new  situa- 
tion created  by  the  industrial  legislation  of  New  Zea- 
land brought  the  community  face  to  face  with  the  ques- 
tion in  what  light  it  ought  to  be  regarded,  and  how  it 
should  be  dealt  with. 

The  problem  was  of  this  kind:  It  had  been  con- 
sidered necessary  for  the  general  well-being  of  the  pub- 
lic to  regTilate  labour  conditions  so  that  a  fair  wage 
should  be  paid  for  what  was  considered  fair  work. 
There  had  been  no  intention  of  compelling  employers 
to  pay  for  anything  less  than  this,  yet  it  was  evident 
that  if  they  were  not  to  be  allow^ed  to  select  the  best 
workers,  both  in  skill  and  personal  vigour,  their  business 
would  be  hampered  by  a  load  of  compulsory  charity. 
The  idea  of  the  old  English  workhouse  was  utterly  op- 
posed to  the  New  Zealand  ideals  of  national  well-being, 
which  included  all  classes  of  the  community  equally. 
In  the  future,  with  fairer  conditions,  and  better  laws 
regulating  labour,  it  might  be  hoped  that  except  in  rare 
instances  old  people,  whether  men  or  women,  might 
need  no  protection  against  want,  or  even  serious  dis- 
comfort ;  under  the  conditions  which  the  new  laws  had 
been  passed  to  remedy  this  could  hardly  have  been  the 
case.  Something,  it  was  evident,  must  be  done  to 
meet  the  situation  —  the  question  was  only,  what  it 
should  be. 

The  Old  Age  Pensions  Law  of  New  Zealand  was  the 
answer  of  the  colony  to  this  question.  Like  nearly  all 
of  the  recent  legislation  it  was,  especially  at  first,  ex- 
posed to  a  great  deal  of  severe  criticism.     Even  now, 


102     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

when  New  Zealand's  example  has  been  followed  by  the 
five  millions  of  Australia,  and  is  being  substantially 
adopted  in  the  mother  country,  as  by  far  the  best  solu- 
tion of  an  intricate  problem,  there  are  not  wanting 
critics  who  maintain  that  the  risk  of  such  a  law  ren- 
dering some  people  improvident  is  a  more  serious  thing 
than  the  certainty  of  degrading  to  a  position  of  mendi- 
cancy thousands  who  have  honestly  contributed  their 
full  share  to  the  work  of  their  country  and  the  pros- 
perity of  their  people.  The  statute  was  passed  by  the 
New  Zealand  Parliament  with  but  little  opposition,  as 
even  those  who  had  objected  to  the  labour  laws  that  led 
directly  to  the  situation,  felt  that  in  fairness  something 
must  be  done.  To  the  great  majority  both  of  repre- 
sentatives and  people  the  proposals  of  the  new  statute 
presented  themselves  in  a  light  that  was  perhaps  pecul- 
iar to  the  people. 

The  preamble,  or  explanatory  introduction,  to  the 
Old  Age  Pensions  Act  gave  in  a  few  words  the  char- 
acteristic point  of  view  taken  by  the  Parliament  and 
people  of  the  proposal.  It  begins  by  the  statement 
that  "  it  is  just  and  right  that  every  person  who  has 
for  a  number  of  years  assisted  by  his  (or  her)  work  in 
the  development  of  the  country,  and  has  also  by  pay- 
ment of  taxes  contributed  to  its  good  government, 
should  be  protected  against  want  in  his,  or  her,  old 
age."  It  proceeds  to  declare  that  all  persons  who  have 
reached  the  age  of  sixty-five  years,  and  have  been  resi- 
dent in  the  country  for  twenty  years  shall  be  entitled 
to  receive  a  pension  out  of  the  public  revenue  large 
enough  to  secure  them  against  want.     The  statute  has 


OLD  AGE  PENSIONS  103 

since  been  amended  by  increasing  the  amount  of  pen- 
sion payable  in  case  of  need,  but  it  has  not  been  other- 
wise altered.  The  object  kept  in  view  was  to  ensure 
that  every  old  resident  should  have  at  least  five  dollars  a 
week  to  live  on.  In  case  the  applicant  for  a  pension  had 
any  savings  or  property,  he  or  she  was  bound  to  dis- 
close it  in  court  to  the  magistrate  whose  duty  it  was  to 
certify  to  the  amount  of  pension  to  which  the  appli- 
cant was  entitled  (for  the  next  year),  which  was  only 
what  was  required  to  make  up  the  total  income  to  the 
five  dollars.  Under  the  amended  law  the  value  of  a 
dwelling  house  used  as  a  home  was  not  deducted  from 
the  amount  of  the  pension  due  to  any  applicant. 

It  may  be  noted  that  the  New  Zealand  legislatorsi 
proposed  to  provide  against  old  age  pauperism  in  their 
country.  They  were  careful  to  place  the  new  law  on 
a  foundation  of  right  and  justice,  not  on  one  of  benevo- 
lence or  charity.  The  pensions  to  aged  settlers  there 
do  not  rest  on  a  basis  of  kindness  to  the  poor  and  in- 
firm, but  on  a  claim  of  right  which  the  aged  settler 
who  is  past  work  has  on  the  country  he  has  helped  to 
develop,  and  the  nation  he  has  assisted  to  good  gov- 
ernment by  bearing  for  many  years  his  share  of  the 
national  burdens.  Persons  who  have  been  convicted 
as  criminals,  or  those  who  having  been  three  times  con- 
victed of  drunkenness  in  public  places  and  are  therefore 
regarded  by  the  law  as  "  habitual  drunkards,"  are  not 
excluded  from  the  benefits  of  the  Pensions  Act,  but  are 
not  themselves  entrusted  with  the  money.  The  pen- 
sions are  in  such  cases  paid  to  the  trustees  and  man- 
agers of  the  homes  for  the  aged  which  are  provided 


104      SOCIAL  WELFAEE  IK  NEW  ZEALAKD 

at  all  the  chief  centres  of  population  for  the  benefit 
of  the  persons  entitled,  who  may  live  there  free  of 
cost,  receiving  a  small  part  of  the  pension  as  a  personal 
allowance.  In  this  way  provision  has  been  made  for 
avoiding  the  scandal  that  must  attach  to  any  national 
system  which  makes  paupers  of  a  class  of  its  people 
who,  in  a  very  large  number  of  cases,  at  any  rate,  have 
been  reduced  to  poverty  by  circumstances  over  which 
they  had  little  or  no  control.  The  people  of  ISTew 
Zealand,  while  —  as  will  be  seen  hereafter  —  affording 
by  legislation  every  encouragement  and  assistance  to  its 
citizens  to  exercise  self-denial  and  providence,  have  re- 
fused to  treat  misfortune  and  poverty  as  a  crime,  or 
even  to  punish  old  age  for  the  mistakes  of  early  life. 

The  Old  Age  Pensions  Statute  of  'New  Zealand  has 
now  been  fourteen  years  in  force,  so  that  some  reason- 
able estimate  may  be  formed  of  its  operation.  In  the 
first  place,  it  may  be  mentioned  that  within  the  coun- 
try itself  the  popularity  of  the  law  has  steadily  in- 
creased, so  that  while  it  had  a  good  many  opponents, 
and  a  still  greater  number  of  doubtful  supporters  at 
the  time  it  was  first  placed  on  the  statute  book  of  the 
country,  there  are  to-day  to  be  found  no  opponents  of 
the  system  within  the  colony,  and  hardly  any  critics 
of  its  operation,  except  the  few  that  in  every  commu- 
nity consider  it  a  distinction  to  object  to  everything 
of  which  their  neighbours  approve.  No  party  in  the 
country  is  now  opposed  to  the  system,  and,  strange  to 
say,  no  politician  thinks  it  worth  while  to  criticise  this 
particular  branch  of  the  administration.  Eor  better 
or  worse  it  has  evidently  been  generally  accepted  as 


OLD  AGE  PENSIONS  105 

part  of  the  State  socialism  of  New  Zealand,  and  it  may 
be  added,  as  the  part  of  it  which  is  the  least  open  to 
unfavourable  criticism. 

It  was  not  until  the  year  1900  that  the  Pensions  law 
began  to  be  largely  taken  advantage  of  in  the  country 
of  its  origin,  and  since  then  it  is  worthy  of  remark, 
there  has  been  very  little  alteration  in  the  extent  to 
which  it  has  been  taken  advantage  of  in  proportion  to 
the  numbers  of  the  population.  The  increase  in  the 
actual  number  of  Old  Age  pensioners  during  the  last 
twelve  years,  indeed,  has  been  largely  due  to  the  fact 
that  an  increasing  number  of  the  Maoris  (the  aborig- 
inal natives  of  New  Zealand)  have  taken  advantage  of 
its  provisions  which,  in  this,  as  in  the  case  of  all  other 
laws  in  the  island  Dominion,  are  equally  available  to 
both  races.  The  number  of  pensioners  under  the 
statute  is  as  nearly  as  possible  one  and  a  half  per  cent, 
of  the  numbers  of  the  entire  European  population,  and 
about  1.3  per  cent,  of  the  entire  population  of  the  coun- 
try. The  amount  paid  last  year  as  Old  Age  pensions 
was  almost  exactly  $1,800,000  (£362,000).  This  the 
people  of  New  Zealand  think  by  no  means  an  excessive 
price  to  pay  for  a  system  which  preserves  the  self-re- 
spect of  a  considerable  number  of  old  people,  who  have 
taken  their  share  in  the  struggles  that  mark  the  early 
stages  of  settlement  in  a  new  country,  and  some  of 
whom,  at  least,  have  been  prevented  from  earning  wages 
to  a  still  later  period  by  the  policy  which  aims  at 
making  it  a  comparatively  easy  thing  in  the  future  for 
every  citizen  to  make  a  provision  for  the  old  age  of  his 
wife  and  himself. 


CHAPTER  VI 

woman's  suffkage 

Among  the  earliest  reforms  that  marked  the  adop- 
tion of  the  new  policy  of  State  Socialism  was  the  amend- 
ment of  the  electoral  system  of  the  comitry.  The 
system  originally  established  in  I^ew  Zealand  was  prac- 
tically the  same  as  that  in  force  at  the  time  in  Eng- 
land, which  recognises  the  possession  of  property  as 
the  basis  of  the  right  to  vote  for  members  of  Parlia- 
ment. This  limitation  had  been  to  some  extent  got  rid 
of  within  a  few  years  of  the  establishment  of  parlia- 
mentary government  in  l^ew  Zealand  by  the  extension 
of  the  franchise  to  all  householders,  whether  land  own- 
ers or  not,  and  as  there  were  but  few  settlers  of  full 
age  who  were  neither  owners  of  land  nor  householders 
the  franchise  was  in  fact  exercised  by  all  but  a  very 
small  proportion  of  the  men.  A  further  extension, 
however,  had  been  advocated  for  some  years,  and  was 
finally  embodied  in  a  statute  in  1893,  by  which  man- 
hood suffrage  was  established,  and  the  possibility  of 
voting  in  more  than  one  electorate  was  done  away. 

Important  as  these  reforms  were  they  were  fully  jus- 
tified by  the  experience  of  other  countries  at  the  time, 
and  therefore  could  hardly  be  looked  upon  as  start- 
ling experiments.     The  feature  of  the  new  electoral 

106 


WOMAN'S  SUFFRAGE  lOY 

law  whicli  did  arouse  a  good  deal  of  discussion  in 
Kew  Zealand  itself,  as  well  as  a  great  deal  of  unfavour- 
able criticism  abroad,  was  tbe  extension  of  tbe  full 
rigbt  of  voting  at  parliamentary  elections  to  tbe  women 
as  well  as  tbe  men.  Tbe  question  of  tbe  rigbt  of  women 
as  well  as  men  to  tbe  francbise  bad  not  at  tbat  time 
become,  as  it  bas  since  done,  botb  in  England  and 
America,  a  subject  exciting  any  wide-spread  interest; 
yet  it  was  not  bastily  or  tbougbtlessly  decided  in  New 
Zealand.  It  bad,  in  fact  —  tbougb  probably  uncon- 
sciously—  been  under  consideration  for  sixteen  years 
in  tbe  colony,  and  tbe  final  embodiment  of  tbis  impor- 
tant reform  in  tbe  electoral  statute  of  1893  was  ratber 
tbe  expression  of  a  national  conviction  founded  on  ex- 
perience, tban  a  basty  experiment  in  tbe  political  life 
of  tbe  country. 

Tbe  experiment  bad  actually  begun  witb  tbe  passing 
of  tbe  Education  Act  of  tbe  colony  wbicb  took  place  in 
tbe  year  1877.  Under  tbe  provisions  of  tbat  statute 
tbe  local  management  of  tbe  public  scliools  was  en- 
trusted to  local  committees  of  tbe  bousebolders  in  eacb 
scbool  district,  tbe  members  of  wbicb  were  elected  an- 
nually by  tbe  bousebolders  resident  in  tbe  district ;  and 
tbe  statute  made  no  distinction  between  male  and  fe- 
male bousebolders,  eitber  as  electors  or  as  candidates 
for  election.  Tbe  provision  wbicb  admitted  female 
bousebolders  to  tbe  scbool  committee  francbise  was  in 
fact  an  amendment  on  tbe  original  draft  of  tbe  statute, 
but  at  tbe  time  it  was  accepted  as  a  matter  of  com- 
paratively small  importance.  Experience,  bowever,  did 
not  confirm  tbe  impression,  and  it  was  generally  found 


108      SOCIAL  WELFAEE  IN"  NEW  ZEALAND 

that  the  female  householders  took  an  interest  quite  as 
intelligent,  and  even  more  active,  in  the  management 
of  the  schools  v^hich  were  attended  by  their  children 
than  the  male  householders  did.  Some  of  them  were 
elected  members  of  committees,  and  the  general  im- 
pression was  that  they  were  among  the  most  active  and 
valuable  members. 

Some  few  years  later  it  was  proposed  to  consolidate 
the  law  relating  to  municipal  governments,  which  up 
to  that  time  had  differed  in  different  parts  of  the  coun- 
try. The  new  statute  proposed  to  place  the  franchise 
for  the  election  of  mayors  and  councillors  in  the  hands 
of  the  persons  liable  to  pay  rates,  and  it  was  pointed 
out  that  as  both  men  and  women  might  be  liable  to  pay 
rates  it  was  but  fair  that  both  should  have  a  voice  in 
the  elections.  This,  after  some  discussion,  was  con- 
ceded, and  the  statute  as  passed  was  so  amended  as  to 
give  the  municipal  franchise  equally  to  men  and  women 
who  were  liable  to  contribute  directly  to  the  municipal 
revenue.  This  concession  was  largely  brought  about 
by  the  experience  that  had  been  gained  by  the  action 
of  the  women  in  relation  to  the  school  committees, 
which  was  used  as  an  argument  that  in  the  public  in- 
terest the  women  of  the  community  could  be  trusted  to 
take  a  really  active  and  intelligent  interest  in  all  mat- 
ters that  directly  appealed  to  them. 

A  few  years'  experience  of  the  working  of  the  new 
municipal  statute  showed  that  those  who  advocated  the 
extension  of  the  franchise  to  the  female  rate-payers 
had  been  right,  as  both  in  their  new  capacity  of  electors, 
and  in  some  cases  as  members  of  councils  they  had 


WOMAN'S  SUFFKAGE  109 

shown  themselves  fully  competent  to  exercise  their  new 
privileges.  Some  years  later  the  law  relating  to  the 
granting  of  licences  to  sell  intoxicating  liquors,  either 
retail  in  hotels,  or  wholesale  in  quantites  of  not  less 
than  two  gallons  in  stores  —  there  are  no  saloon  licences 
merely  for  the  sale  of  liquor  known  in  New  Zealand  — 
the  question  arose  as  to  the  persons  entitled  to  vote 
at  the  elections  of  Licensing  Committees.  Each  Com- 
mittee was  to  represent  one  of  the  parliamentary  elect- 
oral districts,  and  it  seemed  natural  that  the  persons 
in  each  that  possessed  the  parliamentary  franchise 
should  be  the  ones  to  exercise  the  right  of  voting  for 
the  new  Conmaittees  also.  When  the  proposed  statute 
was  being  discussed,  however,  the  question  was  raised 
whether  women  as  well  as  men  ought  not  to  have  this 
new  franchise,  on  the  ground  that  as  many  of  them 
as  paid  rates  had  a  direct  interest  in  such  questions  as 
that  of  the  establishment  of  new  hotels,  or  places  where 
liquor  could  be  bought.  The  proposal  was  strongly 
supported  by  the  temperance  party  in  the  Parliament, 
and  the  success  of  the  two  former  experiments  that  had 
been  made  in  giving  women  the  right  to  vote  on  edu- 
cational and  municipal  questions,  was  urged  as  a  rea- 
son why  this  further  experiment  should  be  made  in 
relation  to  a  question  in  which  they  might  be  expected 
to  take  a  deep  interest  for  the  sake  of  their  families. 
The  contest  was  keen,  and  the  final  majority  which  in- 
troduced the  amendment,  and  gave  the  franchise  for 
this  purpose  to  women  rate-payers  as  well  as  men,  was 
small,  and  many  people  were  more  than  doubtful  as  to 
the  probable  result  of  the  experiment 


110      SOCIAL  WELFAEE  IN  NEW  ZEALAND 

Once  more,  however,  experience  was  in  favour  of  the 
new  law.  The  female  rate-payers  as  well  as  the  men 
voted  for  members  of  the  Licensing  Committees.  As 
a  rule  they  voted  for  the  candidates  whom  public  opin- 
ion generally  considered  the  best  men,  and  rarely  for 
those  of  the  most  extreme  views.  The  prophecies  of 
those  who  anticipated  trouble  for  lady  voters  at  the  polls 
were  not  realised,  and  the  women  entitled  to  vote  did 
so  in  as  large  a  proportion  as  the  men. 

It  was  under  these  circumstances,  and  with  these 
experiences,  that  the  New  Zealand  parliament  ap- 
proached the  question  of  a  final  revision  of  the  par- 
liamentary franchise  law.  A  good  deal  of  difference 
of  opinion  still  existed  on  the  subject,  though  many 
people  had  foreseen  for  some  time  that  the  question 
must  be  settled  before  long.  The  old  English  tendency 
to  avoid  change  of  any  radical  character  as  long  as 
possible  still  existed  in  New  Zealand,  and  all  the  preju- 
dices which  have  made  men  in  every  civilised  nation 
slow  to  admit  that  the  sex  that  is  physically  the  weaker 
may  yet  be  capable  of  taking  an  important  and  valua- 
ble share  in  the  political  life  of  a  country,  had  still 
many  representatives  in  New  Zealand.  All  the  famil- 
iar arguments  were  used  by  the  opponents  of  the  latest 
proposal,  which  was  no  longer  an  amendment  on  the 
statute  as  drafted  by  the  Government,  but  the  leading 
feature  of  the  projDosed  law.  Few  if  any  of  its  oppo- 
nents, indeed,  made  use  of  tlie  old  argument  that  women 
were  intellectually  unfit  to  deal  vdth  public  affairs  at 
all,  as  the  experience  of  fifteen  years,  during  which 
some  at  least  of  them  had  taken  an  active  and  intelli- 


WOMAN'S  SUFFEAGE  111 

gent  part  in  dealing  with  certain  public  matters 
formed  a  sufficient  answer  to  any  such  assertion. 
There  remained,  however,  the  supposed  danger  to  the 
family  life  of  the  people,  likely  to  follow  the  introduc- 
tion of  new  questions  on  which  husbands  and  wives 
might  be  expected  to  take  different  sides,  and  so  break 
up  the  harmony  of  the  household  —  the  sons  of  full 
age  taking  sides  with  the  father,  the  daughters  with 
the  mother.  Another  danger  that  was  dwelt  on  by 
some  opponents  of  the  new  statute  was  the  risk  that 
under  it  the  women  of  the  community  would  cease  to 
look  on  the  home  and  the  household  as  their  natural 
sphere,  and  would  become  public  speakers  and  agita- 
tors in  favour  of  measures  that  specially  appealed  to 
them. 

Some  of  these  arguments,  which  are  familiar  enough 
in  America  and  England  to-day,  had  a  good  deal  less 
influence  on  the  public  mind  in  ISTew  Zealand  owing  to 
the  fact  that,  during  the  years  within  which  a  greater 
amoimt  of  power  and  responsibility  had  been  gradually 
conferred  on  the  women  of  the  country  by  law,  the 
women  themselves  had  in  no  one  instance  agitated  in 
favour  of  the  change.  They  had  not  appeared  on  pub- 
lic platforms  to  advocate  the  reforms;  they  had  not 
formed  processions  to  make  appeals  to  governments  or 
parliaments;  they  had  not  even  besieged  the  editorial 
rooms  of  the  newspapers  with  appeals  on  the  subjects 
that  were  being  considered  by  the  Parliament.  What 
they  had  done  was  different,  but  much  more  effective. 
They  seem  to  have  been  aware  that  the  appeals  most 
likely  to  affect  the  judgment  of  the  men  who  had  the 


112      SOCIAL  WELFARE  IN  NEW  ZEALAND 

power  in  each  case  to  bestow  new  political  powers  on 
their  sex  were  not  likely  to  be  made  more  effectual  by 
any  assertions  of  abstract  right,  but  might  be  influenced 
by  the  argument  of  public  utility  and  advantage. 
They  accordingly  said  little  or  nothing,  but,  as  often 
as  the  opportunity  was  given  them  by  some  new  fran- 
chise conferred  by  law,  took  steps  to  prove  that  they 
could  use  it  intelligently,  and  to  the  public  advantage. 
It  was  this  argument  that  prevailed  in  New  Zealand 
when  at  last  the  question  arose  —  Shall  our  women  be 
allowed  the  same  political  rights,  and  be  burdened 
with  the  same  political  responsibilities  as  our  men  in 
future  ? 

After  a  good  deal  of  discussion  the  answer  to  the 
question  was  given  in  the  affirmative,  and  the  full  elect- 
oral franchise  of  the  country  was  given  to  every  citi- 
zen of  the  age  of  twenty-one  years  and  upwards, 
whether  male  or  female.  The  reform  was  made 
frankly  on  the  ground  of  its  probable  usefulness  to 
the  community  as  a  whole.  Nothing  was  said  either 
in  the  Parliament  or  press  of  the  rights  of  women,  so 
long  denied  them  by  men;  nothing  of  the  more  or  less 
divine  right  of  voting.  It  may  be  that  such  arguments 
have  their  place  elsewhere ;  it  certainly  was  not  in  New 
Zealand,  where  the  good  of  the  people,  and  the  well- 
being  of  its  citizens,  was  the  ideal  that  was  more  and 
more,  even  as  early  as  1893,  beginning  consciously  to 
take  precedence  of  everything  else  in  the  legislation 
of  the  country.  The  future  of  the  young  nation  re- 
quired, it  was  believed,  all  the  energies  and  common- 
sense  of  its  people  to  make  the  most  of  it;  and  the 


WOMAN'S  SUFFKAGE  113 

community  could  not  afford  to  lose  any  help  that  was 
likely  to  prove  valuable.  Abstract  claims  of  right  and 
justice  on  behalf  of  the  women  of  the  community  might 
be  right  or  wrong;  the  right  of  the  young  nation  to 
the  help  of  all  its  people  who  were  able  to  give  it  help 
could  hardly  be  open  to  question.  The  women  formed 
nearly  one-half  the  population,  and  they  had  already 
shown  that  they  were  both  able  and  willing  to  take  an 
intelligent  and  active  part  in  the  management  of  cer- 
tain public  affairs ;  there  seemed  to  be  no  reason  for  de- 
priving the  nation  of  whatever  assistance  they  could 
render  towards  securing  good  laws  and  good  adminis- 
tration on  a  larger  scale  in  the  future. 

For  these  reasons  the  women  of  jSTew  Zealand  were 
granted  the  full  political  franchise  by  statute,  and  they 
have  now  exercised  it  for  seventeen  years,  having 
taken  part  in  the  election  of  five  successive  Parlia- 
ments of  the  island  Dominion.  It  might  be  rash  to 
say  of  this  reform,  as  it  might  of  any  other,  that  there 
have  been  no  cases  in  which  the  new  arrangement  has 
shown  itself  open  to  criticism.  There  may  have  been 
cases  in  which  differences  of  opinion  on  political  ques- 
tions have  crept  into  families,  and  disturbed  the  har- 
mony of  households;  it  may  be  said  with  absolute  cer- 
tainty that  if  so  they  have  been  very  rare.  It  may 
be  said  that  the  new  interests  that  have  been  brought 
into  the  lives  of  ]^ew  Zealand's  women  have  made 
some  of  them  less  entirely  given  up  to  the  cares  of  the 
household,  and  more  inclined  to  have  a  wider  outlook, 
and  to  take  a  broader  view  of  matters  that  may  affect 
the  well-being  of  themselves   and   children;   it  is   at 


114     SOCIAL  WELFAKE  IN"  NEW  ZEALAND 

least  open  to  question  wlietlier  both  the  individuals  and 
the  country  have  not  been  gainers  by  the  change.  One 
thing  may  at  least  be  said  —  they  have  accepted  their 
new  responsibilities,  and  exercised  the  new  privileges 
given  them.  As  a  rule,  it  may  be  said,  that  new  re- 
sponsibilities are  not  quickly  realised  or  acted  upon 
either  by  individuals  or  classes  in  any  community,  and 
there  may  be  two  reasons  that  help  to  account  for  the 
unquestionable  fact  that  in  New  Zealand  the  women 
voters  have  been  very  nearly  as  consistent  in  the  exer- 
cise of  the  political  franchise  as  the  men.  In  the  first 
place,  as  has  been  pointed  out  already,  the  privilege 
of  taking  part  in  the  government  of  the  country  had 
come  to  them  gradually  and  not  suddenly,  and  they 
had  been  trained,  as  women  in  most  other  countries 
have  not,  to  take  an  interest  in  public  affairs.  In  the 
second  place  the  law  of  their  countiy  has  kept  before 
them  the  truth  that  the  political  franchise  is  to  be  re- 
garded in  the  light  of  a  responsibility  quite  as  much  as 
a  privilege. 

By  the  New  Zealand  law  it  is  compulsory  that  each 
person  who  has  the  privilege  of  voting  shall  either  use 
or  lose  the  privilege.  The  electoral  rolls  of  persons 
resident  in  each  electoral  district  are  prepared  a  few 
months  before  each  Parliamentary  election  by  the  po- 
lice force  in  the  district,  and  are  confirmed  in  open 
court  by  the  magistrate  of  the  district,  after  public  no- 
tice to  the  electors.  Every  person  who  does  not  ap- 
pear to  vote  at  the  ensuing  election  must  either  give  a 
good  reason  for  his  absence  in  court,  when  the  next 
roll  is  prepared,  or  must  be  excluded  from  the  list  of 


WOMAN'S  SUFFEAGE  115 

persons  entitled  to  vote.  It  is  at  least  possible  that  to 
one  or  both  of  these  reasons  has  been  due  the  fact  that 
at  the  five  elections  that  have  taken  place  since  women 
obtained  the  full  electoral  franchise  the  women  of  New 
Zealand  have  exercised  the  right  of  voting  in  almost  ex- 
actly the  same  proportion  to  their  numbers  as  the  men. 
In  the  case  of  adults  of  both  sexes  the  proportion  of 
actual  voters  has  been  as  nearly  as  possible  80  per  cent, 
of  those  enrolled. 


CHAPTER  VII 

AIDS    TO    INDUSTEY 

A  COMMOisr  complaint  against  ISTew  Zealand's  legisla- 
tion has  been  that  it  aimed  at  benefiting  the  working 
classes  among  its  people  at  the  expense  of  that  part 
of  its  population  that  more  or  less  represented  capital. 
And  it  is  true  that  if  this  complaint  is  to  be  under- 
stood as  meaning  that  most  of  the  legislation  of  the 
last  twenty  years  has  been  directed  towards  the  increase 
of  wealth  for  that  part  of  the  community  which  for- 
merly had  little  or  none,  the  complaint  is  well  founded. 
ISTo  ITew  Zealander  would  attempt  to  deny  the  accusa- 
tion; very  few  would  look  on  it  as  anything  short  of 
a  compliment  to  the  Government  of  his  country.  The 
laws  passed  to  settle  industrial  disputes  might,  of 
course,  be  defended  from  this  charge  on  the  ground 
that  industrial  peace  is  as  important  to  capital  as  to 
labour;  and  to  some  extent  it  may  be  argued  that  the 
statutes  fixing  wages  in  different  trades,  and  the  hours 
of  labour  in  all,  come  at  least  indirectly  under  the 
same  head.  This,  however,  can  hardly  be  said  of  the 
legislation  with  which  we  have  now  to  deal.  It  was 
a  further  step  in  the  policy  of  state  socialism  when 
statutes  were  passed  for  the  direct  benefit  of  the  classes 
of  the  people  who  were  personally  engaged  in  industrial 

116 


AIDS  TO  INDUSTRY  117 

pursuits.  Tliese  benefits  it  was  hoped  and  believed 
would  be  felt  indirectly  by  all  classes  of  tbe  people, 
but  certainly  in  tbe  first  instance  they  were  directed 
to  the  advantage  of  the  workers  of  the  nation;  and  it 
may  be  admitted  that  it  was  a  step  that  invited  criti- 
cism. 

As  early  as  the  year  1894  a  statute  was  passed  by 
the  Parliament  for  the  financial  relief  of  the  settlers, 
which  embodied  the  policy  —  then  a  new  one  in  the 
country  —  of  a  distinct  State  Socialism,  Up  to  that 
time  settlement  had  proceeded  on  the  old  lines  of  obli- 
ging the  settler  either  to  possess  on  his  own  account,  or 
to  borrow  from  somebody  else  on  the  best  terms  he 
could  command  the  money  needed  to  develop  the  land 
he  occuj)ied.  In  l!^ew  Zealand,  as  in  America  to-day, 
this  condition  of  things  had  produced  in  many  cases 
conditions  that  were  little  better  than  servitude,  under 
which  the  struggling  settler  had  to  work  hard  without 
doing  much  more  than  support  his  family  and  pay  to 
the  mortgagee  of  his  land  eight  or  nine  per  cent,  on 
the  money  he  had  been  compelled  to  borrow  to  develop 
and  stock  his  farm.  According  to  all  the  accepted 
rules  of  political  economy  this  arrangement  was  per- 
fectly satisfactory,  no  doubt.  The  people,  or  the  com- 
panies, that  had  money  to  lend,  got  all  they  could  for 
it;  those  who  were  in  need  of  it  had  to  pay  just  as 
much  as  was  demanded,  or  otherwise  to  give  up  the 
struggle  to  make  a  home  for  themselves  and  children. 

The  Government  of  jSTew  Zealand  had  already  taken 
many  unusual  steps  to  induce  people  to  settle  on  and 
cultivate  the  land  by  making  it  easy  to  get  land  on 


118      SOCIAL  WELFARE  m  NEW  ZEALAND 

which,  to  settle;  this,  however,  was  a  real  difficulty  in 
the  way  of  success  which  could  only  be  met  apparently 
by  taking  a  step  still  more  unusual  than  any  that  had 
gone  before  it  in  the  direction  of  what  was  certain  to 
be  looked  on  as  public  interference  with  private  busi- 
ness. 

The  excuse  made  for  the  high  rate  of  interest 
charged  on  loans  to  the  people  who  wanted  to  improve 
their  lands  was  that  the  security  was  not  sufficiently 
good  to  entitle  borrowers  to  expect  to  get  loans  at 
lower  interest.  It  might  be  true  that  at  the  time  of 
borrowing  the  applicant's  farm  was  worth  twice  as  much 
in  the  market  as  he  wanted  to  borrow,  but  there  was 
always  the  risk  of  bad  times,  and  a  fall  in  price,  and 
the  risk  was  one  that  could  only  be  paid  for  by  a  high 
rate  of  interest.  It  seemed  to  the  New  Zealand  Par- 
liament that  there  was  another  way  of  meeting  the  diffi- 
culty. If  the  possible  risk  that  attached  to  the  ordi- 
nary security  of  the  land  was  the  excuse  for  an 
excessive  rate  of  interest  when  the  money  was  lent  by 
capitalists  to  individuals  the  colony  could  reckon  on 
getting  better  terms  when  it  offered  the  security  of  the 
community  as  a  whole  in  the  English  money  market, 
and  could  thus  indirectly  give  the  settlers  the  benefit  of 
a  national  guarantee.  The  original  statute  authoris- 
ing the  Government  to  make  advances  of  money  to  set- 
tlers, secured  by  mortgage  on  their  land,  with  its  later 
amendments,  has  been  largely  taken  advantage  of  by  the 
people,  partly  owing  to  the  relief  it  has  afforded  them 
from  excessive  rates  of  interest,  and  partly  owing  to 
the  liberal  arrangements  it  has  been  found  possible  to 


AIDS  TO  INDUSTEY  110 

make  in  this  as  in  other  business  transactions  carried 
on  by  the  Government  for  the  payment  of  interest  by 
instalments,  and  the  reduction  of  the  principal  sum 
by  pajTnents  on  account  almost  at  any  time.  The  in- 
terest which  till  the  passing  of  the  statute  had  ranged 
from  seven  to  nine  per  cent,  on  farm  lands  was  reduced 
under  the  new  system  first  to  five  per  cent.,  and  later 
to  four  and  a  half,  with  the  right  to  pay  off  the  prin- 
cipal by  instalments  along  with  any  payment  of  interest. 
Provision  was  made  for  a  careful  valuation  of  all 
lands  on  which  advances  were  asked  for;  but  it  was 
provided  that  a  imiform  margin  of  value  over  the 
amounts  asked  for  should  be  established  and  that  ad- 
vances might  be  made  up  to  three-fifths  of  the  market 
value.  The  result  of  this  has  been  of  two  kinds  — 
settlers  have  now  during  fifteen  years  been  able  to  ob- 
tain the  money  they  needed  for  the  improvement  and 
stocking  of  their  farms  at  four  and  a  half  per  cent., 
instead  of  an  average  of  eight  per  cent.,  as  formerly; 
and  the  general  rates  of  interest  on  mortgages  of  coun- 
try lands  have  automatically  been  reduced  to  very 
nearly  the  Government  rate. 

This  part  of  the  public  business  is  conducted  by  a 
Board  of  Control,  and  while,  as  might  have  been  ex- 
pected in  the  case  of  an  innovation  that  so  seriously 
interfered  with  the  operations  and  proceedings  of 
money-lending  capitalists  and  companies,  its  conduct  of 
business  has  been  closely  watched,  it  has  never,  during 
those  years,  been  exposed  to  any  serious  criticism. 
The  total  amount  that  has  thus  been  advanced  on  mort- 
gage by  the  Government  during  the  fifteen  years  has 


120     SOCIAL  WELFAUE  m  NEW  ZEALAND 

been  a  little  more  tlian  $45,000,000  (£9,343,000), 
and  of  this  there  has  been  repaid  during  the  time  about 
$18,000,000  (£3,680,000),  leaving  a  balance  at  pres- 
ent advanced  on  loan  to  the  farmers  of  about  twenty- 
seven  million  dollars  (£5,470,000),  on  which  the 
farmers  —  and  through  the  farmers  the  country  at  large 
—  save  probably  at  least  eight  hundred  thousand  dollars 
(£180,000)  — on  each  year's  interest. 

The  success  of  the  experiment  of  Government  ad- 
vances to  settlers  after  a  few  years'  trial  naturally  sug- 
gested the  question  whether  there  were  not  other  classes 
of  the  community  whose  condition  might  be  improved 
by  the  application  of  the  same  principle.  It  had  be- 
come evident  that  the  farmers  had  obtained  great  relief 
by  the  national  guarantee  of  their  loans,  both  directly 
and  indirectly,  and  through  them  the  people  at  large 
had  been  the  gainers;  could  not  the  same  principle  be 
applied  to  some  system  that  would  benefit  the  workers 
of  the  conmaunity?  The  answer  to  this  question  was 
found  in  the  provisions  of  the  statute  known  as  "  The 
Advances  to  Workers'  Act,"  which  was  passed  in  the 
year  1906.  The  purpose  of  the  law  was  that  of  en- 
couraging thrift,  and  bringing  within  the  reach  of  the 
class  of  the  people  that  had  up  to  that  time  found  it 
most  difficult,  the  opportunity  of  becoming  their  own 
landlords  by  acquiring  homes  for  themselves  and  fami- 
lies. The  statute  authorised  the  advance  of  public 
money  to  workers  desirous  of  providing  themselves 
with  homes,  to  be  secured  by  a  first  mortgage  of  the 
premises,  which  may  be  either  freehold  or  leasehold. 

A  "worker  is  defined  by  the  law  as  a  person  employed 


AIDS  TO  INDUSTRY  121 

in  either  manual  or  clerical  work  who  is  not  in  receipt 
of  an  income  of  more  than  two  hundred  pounds  ($1,- 
000)  at  the  time  of  making  application  for  the  loan, 
and  is  not  at  the  time  the  owner  of  any  other  land  be- 
sides that  which  is  offered  as  security.  The  person  ap- 
plying may  be  either  a  man  or  woman.  The  loan  may 
be  used  either  for  the  purchase  of  land  on  which  a 
house  has  already  been  built  or  for  the  purpose  of  build- 
ing on  land  already  the  property  of  the  person  apply- 
ing. In  case  the  loan  is  required  for  the  erection  of  a 
house,  the  money  is  to  be  advanced  by  instalments  as 
the  building  progresses,  and  the  house  must  be  inspected 
by  a  government  officer,  and  a  certificate  obtained  from 
him  before  the  balance  of  the  loan  can  be  obtained. 

The  largest  amount  that  can  be  borrowed  from  the 
public  fund  by  any  one  applicant  is  fijced  at  £450 
($2,235),  a  sum  sufficient,  under  ordinary  circum- 
stances, to  pay  for  the  erection  of  a  cottage  home  of 
six  rooms  well  and  substantially  built.  The  loans  are 
in  all  cases  repayable  by  instalments  at  the  end  of 
each  half  year,  the  instalment  of  the  principal  being 
paid  as  part  of  the  interest.  The  interest,  which  in- 
cludes the  instalment  of  principal  necessary  to  pay  off 
the  mortgage  debt  in  thirty  years  is  charged  at  the  rate 
of  five  and  a  half  per  cent,  on  the  amount  of  the  loan, 
on  condition  that  the  half  yearly  payments  are  made 
within  fourteen  days  of  the  due  date  —  if  they  are 
longer  than  this  in  arrear  another  one-haK  per  cent,  is 
charged.  As  in  the  case  of  the  "  Advances  to  Settlers," 
provision  is  made  in  each  mortgage  that  any  part  of 
the  principal  debt  may  be  paid  off  along  with  the  in- 


122      SOCIAL  WELFAEE  IN"  I^EW  ZEALAND 

stalment  due  at  any  half  yearly  period,  at  the  option  of 
the  debtor. 

The  new  law  only  came  into  force  four  years  ago, 
but  already  it  has  been  taken  advantage  of  at  all  the 
chief  centres  of  population  to  a  considerable  extent. 
During  the  first  year,  indeed,  little  was  done,  as  few 
of  the  workers  were  ready  to  take  advantage  of  it  by 
themselves  securing  a  site  for  a  home.  Since  then, 
however,  the  number  of  applicants  has  increased  year 
by  year,  and  already  a  sum  of  between  seven  and  eight 
million  dollars  has  been  advanced  for  the  building  of 
homes  for  the  workers  of  the  community.  This  repre- 
sents about  five  thousand  workers'  homes  that  have 
been  built  with  money  advanced  by  the  State  to  indi- 
viduals, showing  an  average  amount  of  about  fifteen 
hundred  dollars  (£300)  advanced  in  each  case. 

The  time  during  which  the  system  has  been  in  force 
has  not  been  long  enough  to  enable  its  full  results  to 
be  ascertained  on  any  very  large  scale,  but  it  may  be 
said  with  confidence  that  up  to  the  present  time  it  ap- 
pears to  have  been  eminently  successful.  The  amounts 
advanced  have  been  drawn  from  the  public  loans,  au- 
thorised by  Parliament,  and  obtained  at  an  average 
cost  of  three  and  a  half  per  cent.,  without  including 
the  expenses  incurred  in  raising  them.  There  has  thus 
been  a  margin  of  about  one  per  cent,  on  the  advances 
made  to  meet  the  various  expenses  of  administration, 
which  in  a  case  of  this  kind  are  necessarily  rather 
heavier  than  usual.  The  experience  of  the  four  years 
has  been  most  satisfactory  from  a  financial  point  of 
view,  both  interest  and  instalments  of  principal  hav- 


AIDS  TO  INDTJSTEY  123 

ing  been  paid  within  the  time  fixed  to  entitle  the  mort- 
gagees to  the  reduction  of  one-half  per  cent,  on  the 
interest  payable.  So  far  the  public  has  experienced 
no  losses,  as  in  the  very  rare  cases  in  which  for  some 
reason,  such  as  the  illness  or  death  of  the  mortgagee, 
it  was  found  difficult  to  pay  the  interest  and  instal- 
ments of  principal  due  the  o"\vners  have  found  no  diffi- 
culty in  disposing  of  the  property  at  a  higher  price 
than  that  at  which  it  had  been  valued  by  the  Govern- 
ment valuers  when  the  loan  was  applied  for. 

It  need  hardly  be  said  that  the  legislation  which  au- 
thorised advances  of  money  borrowed  on  the  credit  of 
the  whole  community  to  farmers  to  enable  them  to 
develop  and  improve  their  farms,  or  to  workers  to  build 
homes  for  their  families  at  reasonable  rates  of  inter- 
est, was  a  very  marked  advance  in  the  system  of  state 
socialism.  A  statute  passed  in  1908,  however,  has  in- 
troduced a  still  further  advance  in  the  same  direction. 
The  statute  is  known  as  "  The  Workers'  Dwellings 
Act,"  and  its  object  is  to  provide  dwellings  at  centres 
of  population  of  a  size  and  kind  suitable  for  mechan- 
ics and  labourers  who  are  not  as  yet  in  a  position  for 
any  reason  to  avail  themselves  of  the  provisions  of  the 
statute  providing  loans  for  workers  anxious  to  secure 
homes  for  their  families. 

In  New  Zealand,  as  everywhere  else,  the  wish  of  the 
class  of  people  who  have  capital  is  still  to  get  the 
largest  possible  return  for  it.  It  cannot  be  denied 
that  for  the  last  twenty  years  the  tendency  of  the  coun- 
try's legislation  has  been  unfavourable  to  this  policy 
of  capital.     The  laws  affecting  labour  have  in  many 


124     SOCIAL  WELFAEE  IIT  NEW  ZEALAND 

ways  interfered  with  the  possibility  of  making  large 
fortunes  by  trade,  in  the  way,  and  to  the  extent  that 
has  been  possible  in  every  other  civilised  country ;  it  is 
not  surprising  that  many  small  capitalists  have  thought 
it  a  good  speculation  to  invest  their  money  in  city  and 
suburban  lands,  and  to  build  houses  for  which  a  large 
rental  could  be  obtained  —  large,  that  is  to  say,  in  pro- 
portion to  their  cost.  The  workers  of  the  nation,  which 
in  New  Zealand  have  been  defined  by  statute,  as  that 
part  of  the  people  employed  at  either  manual  or  cler- 
ical work  for  which  not  more  than  a  thousand  dollars 
is  paid  in  each  year,  were  naturally  those  who  were 
the  principal  suiferers  by  this  policy.  Small  houses 
of  four  or  five  rooms  were  let  at  the  chief  centres  at 
rentals  that  ate  up  at  least  one-fourth  of  the  wages  of 
the  people  who  occupied  them.  This,  it  was  said  by 
the  owners,  was  necessary  to  enable  the  landlords  to 
pay  rates  and  taxes,  and  to  leave  them  seven  to  eight 
per  cent,  on  their  investments,  which  was  little  enough, 
they  contended,  on  house  property. 

Once  more  the  habit  of  experiment  made  itself  felt, 
and  at  the  session  of  Parliament  held  in  1908  author- 
ity was  given  to  the  Executive  Government  to  go  into 
business  as  householders,  as  far  as  might  be  necessary. 
At  the  end  of  the  first  year  of  the  experiment  one  hun- 
dred and  eight  houses  had  been  built,  and  let  in  al- 
most every  case  to  mechanics  at  a  rental  of  about  $125 
(£26)  for  each.  The  houses  have  been  built  at  a 
cost  of  a  little  more  than  two  thousand  dollars  each 
on  an  average — (£410) — which  includes  the  cost 
of  the  land,  measuring  fully  one-fifth  of  an  acre  in 


AIDS  TO  INDUSTRY  125 

eacli  case,  and  the  rentals,  which  are  but  little  more 
than  one-half  what  has  usually  been  paid  as  rent  for 
much  less  desirable  houses  in  the  neighbourhoods  in 
which  they  are  situated,  provide  five  per  cent,  on  the 
outlay,  besides  providing  for  local  rates,  taxes,  and 
insurance.  The  houses  are  of  five  rooms,  and  are  neat 
and  attractive  in  appearance,  while  the  allotments  on 
which  they  stand  are  large  enough  to  allow  room  for  a 
small  garden. 


CHAPTER  VIII 

A   GOVEENMENT    IN    BUSINESS 

Theee  is  notking  on  which  the  opinion,  or  at  any 
rate  the  general  feeling,  of  the  world  of  commerce 
would  be  more  likely  to  unite  than  that  of  the  folly  of 
any  national  government  going  into  business.  Amer- 
icans, who  perhaps  not  unnaturally  look  on  themselves 
as  the  foremost  commercial  people  of  the  world  of  to- 
day, are  probably  the  most  entirely  convinced  on  this 
subject.  That  a  Government  could  possibly  do  busi- 
ness as  well  as  a  private  company  or  corporation, 
seems  to  nearly  all  of  them  ridiculous,  and  one  of  the 
strongest  arguments  against  any  form  of  socialistic 
government  would  for  most  of  them  be  found  in  the 
necessity  for  a  government  management  of  so  many 
business  affairs  as  would  almost  certainly  fall  into  its 
hands. 

The  State  Socialism  of  ISTew  Zealand,  it  may  be  at 
once  admitted,  lays  itself  open  to  whatever  of  justice 
there  may  be  in  such  criticisms.  The  interference  of 
Government  in  a  good  many  things  that  elsewhere  have 
been  left  entirely  to  private  enterprise  is  indeed  a 
much  older  thing  there  than  most  of  the  innovations  on 
established  custom  that  have  called  special  attention  to 
the  country  during  the  last  eighteen  or  twenty  years. 

126 


A  GOVERNMENT  IN  BUSINESS        127 

One  of  the  first  public  needs  that  made  itself  keenly 
felt  in  New  Zealand  after  settlement  had  begun  on  any 
considerable  scale  was  that  of  internal  communication. 
This  was  not,  of  course,  peculiar  to  the  island  colony, 
and  elsewhere,  as  for  instance,  in  Australia,  it  had  been 
met  by  the  construction  of  roads  into  the  interior  on  a 
large  scale.  New  Zealand,  however,  being  a  colony  of 
very  late  establishment  had  more  modern  ideas ;  and 
almost  from  the  first  was  ambitious  of  possessing  rail- 
roads as  the  modern  equivalents  of  the  old-fashioned 
highways  of  older  countries.  At  the  time,  and  with 
a  total  white  population  of  little  more  than  two  hun- 
dred thousand  settlers  scattered  along  the  coast,  with 
wide  intervals  between  the  little  settlements,  it  was  evi- 
dently out  of  the  question  to  expect  any  private  com- 
pany to  speculate  in  railroad  construction  in  the  hope  of 
obtaining  dividends.  If  there  were  to  be  railroads  in 
the  country  at  all  it  was  certain  they  must  be  con- 
structed by  the  Government,  and  paid  for  with  public 
funds,  and  to  the  settlers  tliere  seemed  nothing  un- 
natural, or  unusually  dangerous  in  the  proposal.  The 
money  needed  for  such  an  undertaking  could  be  bor- 
rowed on  the  credit  of  the  whole  colony,  and  at  the  time 
it  could  be  got  in  no  other  way. 

It  was  in  this  way  that  the  first  important  step  was 
taken  which  involved  the  necessity  for  the  Executive 
of  the  country  going  into  ordinary  commercial  business. 
The  first  attempts  at  railroad  making  were  the  work  of 
the  Provincial  Governments  in  different  parts  of  the 
country,  but  in  1873  they  were  taken  over  by  the  Gov- 
ernment of  the  colony  as  part  of  a  proposed  system  of 


128     SOCIAL  WELFAilE  m  NEW  ZEALAND 

national  public  works,  and  have  now  been  operated  by 
tbe  colonial  Executive  as  a  department  of  the  public 
service  for  nearly  forty  years.  At  a  later  date  two  dif- 
ferent incorporated  companies  obtained  authority  to 
construct  railroads,  one  in  the  north  and  the  other  in 
the  south  island,  but  both  were  eventually  taken  over  by 
the  Government  at  a  valuation,  and  became  parts  of  the 
national  system.  The  work  of  construction  has  been 
proceeded  with  year  after  year  by  the  Government  with 
the  sanction  of  Parliament,  till  there  are  now  nearly 
three  thousand  miles  of  railroad  in  operation  in  the  two 
islands  —  an  amount  of  railroad  accommodation  for  the 
public  which  exceeds  that  provided  by  any  other  coun- 
try in  the  world,  in  proportion  to  the  population,  not 
even  excepting  America. 

The  purpose  that  has  from  the  first  been  acknowl- 
edged as  that  of  railroad  construction  in  New  Zealand 
has  been  opening  up  the  lands  of  the  country  for  set- 
tlement, not  that  of  earning  the  largest  possible  profits ; 
and  in  this  lies  the  radical  distinction  between  a  na- 
tional and  a  commercial  railroad  system.  All  the  New 
Zealand  railroads  have  been  constructed  with  borrowed 
money,  and  the  present  mileage  has  cost  the  country 
about  $126,000,000  (£25,000,000).  The  sum  is  a 
very  large  one,  invoMng  a  liability  of  about  $125 
(£25)  per  head  on  the  whole  population;  but  it  is  to 
be  remembered  that  it  is  strictly  a  business  transaction, 
in  which  the  community  obtains  the  capital  for  a  little 
over  three  and  a  half  per  cent,  which  would  have  cost 
a  private  company  from  five  to  six  per  cent.  The  rail- 
road department  of  the  countiy  has  grown  very  grad- 


A  GOVEE.NMENT  IN  BUSINESS        129 

uallj,  but  it  has  now  reached  the  dimensions  of  a  very 
large  business  undertaking;  it  remains  to  be  seen  how 
far  it  has  proved  a  success. 

Nearly  everything  that  has  been  said  of  the  New 
Zealand  railroad  system  may  be  said  also  of  the  tele- 
graphs and  telephones  of  the  country.  From  the  very 
first  these  have  been  constructed  and  operated  as  a  por- 
tion of  the  Post  Office  system  of  the  country.  In  1872 
fully  two  thousand  miles  of  telegraph  lines  had  been 
erected,  which  were  gradually  added  to,  as  the  demand 
increased,  and  settlement  extended,  till  in  1910  there 
were  more  than  eleven  thousand  miles  of  lines  in  op- 
eration in  the  two  islands,  carrying  more  than  35,000 
miles  of  wires.  In  addition  to  this  there  are  deep  sea 
cables  between  the  two  islands,  and  an  ocean  cable,  es- 
tablished by  the  colony,  connecting  the  islands  with 
Australia.  The  telephone  service  of  New  Zealand  is 
comparatively  a  recent  addition  to  the  department,  but 
during  the  twenty  years  it  has  existed  it  has,  like  the 
telegraph  service,  been  made  use  of  by  a  rapidly  in- 
creasing percentage  of  the  population.  It  is  worthy  of 
special  attention,  that  the  use  made  both  of  telegraphic 
and  telephone  services  in  New  Zealand  very  far  exceeds 
that  of  any  other  country,  while  the  charges  made  by 
the  department  are  on  a  much  lower  scale  than  in  any 
other  civilised  country,  and  are  less  than  half  those 
charged  by  the  great  corporations  that  control  both  serv- 
ices in  America. 

The  explanation  of  the  low  rates  charged  for  tele- 
graph and  telephone  services  in  New  Zealand  is,  of 
course,  the  fact  that  in  neither  case  is  it  sought  to 


130     SOCIAL  WELFARE  IN  NEW  ZEALAND 

make  profit  out  of  the  public  service,  and  the  charges 
are  regulated,  like  those  on  the  State  railroads,  merely 
on  the  principle  of  providing  for  working  expenses, 
maintenance,  and  the  actual  amount  of  interest  pay- 
able on  the  capital  invested  by  the  State  in  the  construc- 
tion of  the  lines.  The  working  expenses  are,  no  doubt, 
greatly  reduced,  while  the  convenience  to  the  public  is 
increased,  by  the  incorporation  of  both  telegraph  and 
telephone  services  with  the  post  ofiice  department  of 
the  country.  This  enables  practically  every  post  office 
throughout  the  country  to  become  also  an  office  for  tele- 
graphic service,  without  the  cost  of  establishing  sep- 
arate offices,  or  employing  —  except  at  centres  of  pop- 
ulation —  separate  operators,  as  each  postmaster,  or 
mistress,  in  small  tovms  or  country  districts  is  obliged 
to  qualify  as  a  telegraph  operator. 

The  experience  of  New  Zealand  in  the  management 
of  business  affairs,  extending  beyond  the  time-honoured 
limits  of  the  post  office  service,  had  therefore  been  of 
a  good  many  years'  standing  before  the  country  had 
thought  of  adopting  anything  that  could  be  called  a 
definite  policy  of  State  Socialism.  Its  railroads  had 
been  in  operation  for  more  than  twenty  years,  its  tele- 
graph services  for  fifteen  —  though  in  both  instances, 
it  is  true,  on  a  small  scale  —  before  the  new  policy  was 
definitely  adopted,  and  the  experience  of  those  years  had 
much  to  do  with  the  readiness  of  the  people  to  proceed 
with  new  experiments.  A  third  branch  of  what  is 
usually  looked  on  as  commercial  business  that  was  un- 
dertaken at  an  early  date  by  the  New  Zealand  Govern- 
ment was  that  of  Life  Insurance,  as  a  Department  of 


A  GOVERNMENT  IN  BUSINESS        131 

Government.  When  it  was  founded  there  were  a  num- 
ber of  companies  —  English,  American,  and  Colonial  — 
carrying  on  the  business  of  life  insurance  in  the  colony. 
There  had  at  the  time  been  several  cases  of  failure 
among  insurance  companies,  both  in  England  and 
America,  and  some  uneasiness  was  felt  about  the  abso- 
lute safety  of  such  investments.  It  was  believed  that 
this  feeling  of  uneasiness  could  best  be  removed  by  the 
guarantee  of  the  colony,  which  could  only  be  given  to 
insurance  policies  issued  by  the  Government  itself. 
Another  reason  for  the  establishment  of  an  Insurance 
Department  of  the  Government  was  that  while  the  rate 
of  mortality  was  lower  in  New  Zealand  than  either  in 
America,  England  or  Australia,  no  account  was  taken 
of  this  fact  in  the  premiums  charged  so  that  New  Zea- 
land insurers  were  called  on  to  pay  the  same  premiums 
that  were  charged  in  countries  where  the  death  rate  was 
fifty  per  cent,  higher  than  it  was  there. 

These  reasons  had  led  to  the  establishment  of  a  Life 
Insurance  Department  a  good  many  years  before  any- 
body in  the  country  had  thought  of  entering  on  the 
series  of  experiments  that  have  gradually  assumed  the 
form  of  a  settled  policy.  The  new  department  had  been 
founded  on  a  careful  investigation  of  the  special  con- 
ditions of  the  country  and  its  people,  which  had  led  to 
important  reductions  in  the  scale  of  premiums  charged, 
and  while  no  effort  had  been  made  to  advertise  its  ad- 
vantages, it  had  become  within  a  few  years  a  formi- 
dable competitor  of  even  the  most  popular  companies  es- 
tablished in  other  countries,  and  having  branches  in  the 
colony.     It  was  not  until  the  last  ten  years  of  the  last 


132      SOCIAL  WELFAEE  11^  NEW  ZEALAND 

century  that  the  New  Zealand  Insurance  Department 
of  the  Government  was  authorised  to  extend  its  busi- 
ness into  the  field  of  ordinary  industrial  insurance,  and 
to  grant  insurance  policies  to  provide  against  accidents. 
In  the  year  1903  this  was  further  extended  to  insurance 
against  fire,  and  in  both  cases  the  reasons  for  the  ex- 
tension were  practically  the  same  —  namely,  the  pro- 
tection of  the  people  from  what  seemed  to  be  excessive 
demands  of  premium  rates  arranged  between  the  various 
companies  doing  business  in  the  country. 

Since  the  year  1903,  that  is  to  say  for  the  last  eight 
years,  the  New  Zealand  Government  has  been  carrying 
on  the  three  branches  of  national  insurance  —  Life,  Ac- 
cident, and  Eire, —  the  two  latter  of  which,  at  least, 
must  be  regarded  as  coming  under  the  head  of  ordinary 
business  enterprise.  In  all  three  cases  the  object  of 
Government  interference  was  the  betterment  of  the  peo- 
ple. In  the  first,  greater  security  for  insurers  was  the 
main  object,  though  other  important  advantages  were 
looked  for,  and  have  been  realised.  In  the  other  two 
branches,  which  represent  the  more  purely  commercial 
side  of  the  insurance  business  undertaken,  the  object  of 
the  Government  was  to  prevent  what  appeared  to  be  an 
imposition  on  the  public  by  an  agreement  between  the 
companies  to  fix  a  uniform  and  excessive  scale  of 
premiums.  The  attempt  is  a  familiar  one  in  America, 
and  one  which  the  Government  has  for  years  been  fight- 
ing against ;  it  may  fairly  be  said  with  little  or  no  suc- 
cess. The  New  Zealand  experiment  has  at  least  ap- 
parently been  attended  with  better  results,  as  in  both 
cases  the  effect  of  Government  competition  has  been  to 


A  govee:nment  m  business      133 

cause  the  reduction  of  tlie  premiums  of  the  other  com- 
panies to  the  scale  of  charges  introduced  by  the  Gov- 
ernment Department. 

Within  a  very  few  years  of  the  first  settlement  of  !N"ew 
Zealand  Savings  Banks  of  the  type  familiar  to  the  peo- 
ple of  Great  Britain  and  America  for  many  years,  were 
established  at  each  of  the  chief  centres  of  population. 
These  were  for  a  good  many  years  sufficient  to  meet  the 
needs  of  the  people,  who  were  in  those  early  days  settled 
within  a  very  short  distance  of  one  or  other  of  the  little 
cities.  In  those  times,  too,  it  was  but  a  small  propor- 
tion of  the  people  that  had  any  need  for  a  bank  in  which 
to  deposit  savings,  as  savings  were  few,  and  what  there 
were  found  a  ready  place  of  deposit  in  the  land  that  was 
occupied  by  the  great  majority  of  the  struggling  settlers. 
As  the  years  went  on,  however,  and  settlement  spread 
over  the  back  coimtry,  circumstances  altered,  and  it  be- 
came increasingly  difficult  for  the  settlers  at  a  distance 
to  reach  the  cities,  either  to  deposit  savings,  or  to  with- 
draw the  money  that  might  lie  in  the  savings  banks 
at  their  credit.  The  demand,  too,  for  such  institutions 
was  steadily  increasing  as  time  went  on,  and  the  time- 
honoured  substitute  of  the  homely  stocking  foot  gave  less 
and  less  satisfaction. 

At  last  the  need  of  doing  something  to  provide  for  the 
public  convenience  led  to  the  addition  of  a  Savings 
Bank  Department  to  the  Post  Office  service  of  the  coun- 
try. The  new  departure  had  two  manifest  advantages 
at  least  to  offer,  as  compared  with  the  old  Savings  Bank 
system.  It  gave  to  every  depositor  the  guarantee  of  the 
credit  of  the  whole  Community  instead  of  that  of  a 


134      SOCIAL  WELFAEE  m  NEW  ZEALAND 

small  body  of  Trustees :  it  also  enabled  the  advantages  of 
the  institution  to  be  brought  within  the  reach  of  nearly 
the  whole  population  at  very  small  expense.  It  must, 
of  course,  be  admitted  that  it  was  another,  and  a  very 
serious  excursion  into  the  domain  —  so  long  considered 
sacred  to  private  management  of  business  finance.  It 
has  now  for  a  good  many  years  involved  the  handling 
and  investment  of  large  sums  of  the  people's  money,  be- 
cause it  has  been  taken  advantage  of  to  an  extent,  which 
in  comparison  with  the  numbers  of  the  inliabitants,  has 
been  remarkable,  and  indeed  unequalled  in  any  other 
country  in  the  world. 

New  Zealand  is  to-day  a  country  in  which  most  of  the 
modern  inventions  for  the  convenience  and  benefit  of 
the  people  are  to  be  found  in  very  general  use,  and 
among  these  the  postal  facilities  of  every  kind  are  among 
those  that  attract  first  the  attention  of  visitors  to  the 
country.  The  Post  Office  department,  which  in 
America  and  England  has  long  been  remarkable  for  its 
efficient  management,  and  excellent  business  arrange- 
ments, has  in  New  Zealand  a  wider  scope,  and  one  of  far 
more  general  usefulness  to  the  public  than  in  either 
country.  There  are  within  the  Dominion  at  this  time 
about  two  thousand  four  hundred  Post  Offices  for  the 
use  of  about  a  million  people.  Of  these  more  than  six 
hundred  and  fifty  do  business  as  branches  of  the  Postal 
Savings  Bank  of  the  country,  and  thus  bring  within  the 
reach  of  the  people  in  every  district  all  the  benefits  to 
be  gained  by  ready  access  to  a  banking  establishment 
which  combines  the  safety  of  national  guarantee  with  a 


A  GOVERNMEjSTT  m  BUSINESS        135 

simplicity  and  liberality  of  system  far  beyond  that  of  tbe 
Savings  Banks  of  older  countries. 

In  addition  to  the  Money  Order  business,  wbicb  is 
carried  on  at  very  nearly  one-half  the  branch  post  offices 
throughout  the  country,  there  is  a  large  business  done  in 
the  sale  and  payment  of  postal  notes,  by  means  of  which 
money  in  small  amounts  can  be  transmitted  to  any  part 
of  the  country  without  the  trouble  involved  in  the  money 
order  system.  Of  these  postal  notes  more  than  a  mil- 
lion and  a  half  were  issued  at  the  various  post  offices 
within  the  Dominion  and  paid  at  other  post  offices  within 
the  last  year. 

JSTew  Zealand,  especially  on  the  western  side  of  the 
south  island  has  now  for  many  years  been  the  seat  of  a 
very  considerable  coal-mining  industry.  The  coal  ob- 
tained is  generally  a  very  high  class  of  hard  bituminous 
coal  particularly  valuable  for  steam  purposes,  and  the 
work  of  development  has  been  carried  on  by  a  few  com- 
panies, the  shares  in  which  are  largely  held  by  Eng- 
lish, or  at  least  by  absentee  shareholders.  In  the  year 
1901  a  statute  was  passed  by  the  Parliament  to  author- 
ise the  Government  to  open  and  operate  State  Coal  mines 
on  public  lands,  and  a  few  years  later  a  large  area  of 
the  coal-bearing  lands  on  the  west  coast  of  the  south 
island  was  reserved  from  sale  for  that  purpose.  The 
immediate  object  of  the  new  experiment  was  the  pro- 
vision of  a  source  of  supply  for  the  purposes  of  the  pub- 
lic railroads  of  the  country,  though  the  terms  of  the 
statute  left  it  optional  with  the  Government  to  use  the 
produce  of  the  mines  for  other  purposes,  should  it  appear 


136      SOCIAL  WELFAHE  1^  NEW  ZEALAND 

desirable  at  any  time  to  do  so.  Two  very  considerable 
mines,  situated  within  a  short  distance  of  the  two  chief 
coal  exporting  harbours  of  the  country  have  now  been 
in  active  operation  for  some  years. 

For  some  time  these  mines  were  only  worked  to  the 
extent  necessary  to  supply  fuel  for  the  railroads,  but 
some  years  ago  there  was  a  great  strike  among  the  coal- 
miners  in  New  South  Wales,  and  the  coal  mining  com- 
panies in  New  Zealand  took  advantage  of  it  to  raise  the 
prices  of  their  coals,  knowing  that  no  coals  could  be  im- 
ported to  interfere  with  them  from  Australia.  As  soon 
as  this  became  a  matter  of  common  complaint  the  Gov- 
ernment took  steps  to  increase  the  output  of  their  own 
mines,  and  offered  to  supply  dealers  at  the  old  prices. 
At  first  the  companies  prevented  most  of  the  dealers 
from  buying  the  Government  coals  by  threats  that  they 
would  sell  none  to  anybody  who  dealt  with  the  Govern- 
ment mines.  The  attempt,  however,  did  not  last  long, 
as  the  Government  proceeded  to  establish  depots  at  all 
the  chief  centres  of  population,  and  offered  to  supply 
coals  at  retail  prices  to  consumers.  When  this  step  was 
taken  the  struggle  was  practically  at  an  end ;  and  within 
a  few  weeks  the  coal-mining  companies  sun-endered  at 
discretion,  and  reduced  their  prices  to  the  old  scale. 
The  Government  coal  depots  still  exist  at  the  principal 
centres,  but  while  coals  can  still  be  got  there  by  the  pub- 
lic, no  attempt  is  made  to  push  the  sale,  or  to  increase 
the  production  of  the  Government  mines  —  the  mere 
fact  of  the  existence  of  the  depots  being  looked  on  as  a 
warning  to  the  producers,  and  a  guarantee  of  fair-play 
to  the  public. 


A  GOVERNMENT  IN  BUSINESS        137 

One  more  instance  of  the  interference  of  tlie  New 
Zealand  Government  in  matters  of  business  may  be  men- 
tioned as  the  latest  development  of  the  policy  of  Gov- 
ernment for  the  people  without  regard  to  old  established 
ideas  and  practices.  This  law,  which  came  into  op- 
eration at  the  beginning  of  this  year  is  intended  to  pro- 
vide for  a  National  Provident  Fund,  the  object  of  which 
is  to  do  on  a  national  scale  what  has  hitherto  been  at- 
tempted, and  partly  accomplished,  in  most  civilised 
countries  of  European  origin  by  a  great  variety  of 
Friendly  Societies.  Such  societies  have  existed  in  New 
Zealand  almost  from  the  beginning  of  its  settlement,  and 
have  undoubtedly  been  of  service  to  many,  especially  of 
the  inhabitants  of  the  cities  and  larger  towns  of  the 
country.  The  purpose  of  the  new  statute  is  the  char- 
acteristic one  of  placing  the  Government  of  the  Do- 
minion in  the  position  of  the  national  Friendly  Society 
of  the  New  Zealand  people.  It  aims  at  providing  all, 
and  more  than  all  the  benefits  that  could  hitherto  be  ob- 
tained by  joining  one  or  other  of  the  societies  for  mutual 
benefit,  very  often  subject  to  conditions  that  excluded 
many  of  the  people  from  membership.  The  new  Na- 
tional Provident  Fund  will  be  open  to  all  the  workers 
of  the  Community,  using  the  term  "  workers  "  in  the 
sense  defined  by  several  of  the  laws  already  mentioned  in 
these  pages,  as  persons  engaged  in  work,  either  man- 
ual or  clerical,  for  which  they  do  not  receive  as  wages 
or  salary  more  than  £200  ($1,000)  a  year;  and  the  con- 
tributors to  the  Fund  will,  in  return  for  payments,  made 
either  weekly  or  monthly,  become  entitled  to  annuities 
of  from  ten  shillings  (two  and  a  half  dollars)  to  two 


138     SOCIAL  WELFAEE  IK  I^EW  ZEALA]^X> 

pounds  (ten  dollars)  a  week  for  the  rest  of  their  life 
after  they  reach  the  age  of  sixty  years. 

The  conditions  under  which  persons  may  become  con- 
tributors are  simple.  All  contributors  must  be  between 
sixteen  and  forty-six  years  of  age  at  the  time  of  join- 
ing, and  the  weekly  payments  may  be  anywhere  be- 
tween nine  pence  (eighteen  cents)  and  twenty  shillings 
($5.00),  according  to  the  age  at  which  the  contributor 
joins,  and  the  amount  of  the  annuity  he  wishes  to  se- 
cure. It  is  provided  that  if  any  contributor  of  at  least 
five  years'  standing,  or  any  person  already  in  receipt  of 
an  annuity  under  the  statute  die,  leaving  children  un- 
der fourteen  years  of  age,  a  sum  of  seven  shillings  and 
sixpence  (about  $1.75)  shall  become  payable  to  his 
widow  for  every  such  child,  till  he,  or  she,  shall  reach 
that  age.  The  widow  also  becomes  entitled  to  receive 
the  same  amount  for  her  own  use  till  her  youngest  child 
reaches  the  age  of  fourteen.  There  are  also  further  pro- 
visions by  which  contributors  suffering  from  illness  or 
temporary  disablement  for  more  than  three  months  be- 
come entitled  to  receive  the  same  amount  for  each  of 
their  children  under  the  age  of  fourteen  until  recovery. 

The  new  statute  has  only  lately  come  into  force,  and 
it  is  therefore  impossible  as  yet  to  say  much  as  to  its 
operation,  though  there  are  already  strong  evidences  that 
it  will  be  very  largely  taken  advantage  of  by  that  part 
of  the  population  for  whose  immediate  benefit  it  has 
been  enacted.  It  may  also  be  noted  that  it  is  entirely 
in  accord  with  the  general  principles  which  have  more 
and  more  distinguished  the  legislation  of  N^ew  Zealand 
from  that  of  other  countries  during  the  last  twenty  years. 


CHAPTER  IX 

EXPEEIMENTS  IN  FINANCE 

!N'ew  Zealand  has  the  largest  national  debt  in  the 
world  in  proportion  to  the  number  of  its  people.  The 
statement  is  a  familiar  one,  for  it  has  been  used  for  a 
good  many  years  as  the  strongest  possible  condemnation 
of  the  economic  system  of  the  Community  that  has  been 
bold  enough  to  set  at  defiance  the  conclusions  of  political 
economists.  At  first  sight  the  statement  appears  to  be 
a  serious  one.  A  heavy  national  debt  naturally  implies 
to  the  minds  accustomed  to  the  generally  accepted 
theories  of  Government  a  heavy  national  taxation,  and 
a  people  more  or  less  depressed  by  the  burden.  In  the 
case  of  'New  Zealand,  it  may  at  once  be  admitted,  the 
statement  of  a  heavy  national  debt  is  unquestionably 
correct.  The  Dominion  of  ISTew  Zealand  owes  to-day  a 
larger  national  debt  than  any  other  country  in  the 
world  in  proportion  to  the  number  of  its  people  —  it  is 
not  the  fact,  but  the  meaning  and  effect  of  the  fact,  that 
is  really  important. 

National  debts  are  things  to  which  civilised  nations 
have  long  become  accustomed,  and  have  learned  to  look 
upon  as  almost  necessary  evils.  They  have  grown  gen- 
erally —  as  in  the  cases  of  England  and  America  —  out 
of  great  wars,  or  the  preparations  for  national  defence 

139 


140     SOCIAL  WELFAEE  IN"  NEW  ZEALAND 

against  possible  attack,  and  so  have  naturally  been 
looked  on  as  burdens  that  were  only  to  be  submitted  to 
when  there  was  no  way  of  escape,  and  to  be  got  rid  of 
at  the  earliest  moment  possible.  And  yet,  at  the  worst 
they  were  never  so  heavy,  in  proportion  to  the  number 
of  the  peoples  that  had  to  bear  them,  as  the  national 
debt  of  New  Zealand  —  a  coimtry  which,  to-day, 
ventures  to  consider  itself  unusually  prosperous. 
Many  Americans  can  still  remember  the  conditions  of 
trade  depression  that  followed  the  close  of  the  Civil  War, 
due,  in  part  at  least,  to  the  weight  of  the  huge  national 
debt,  and  the  taxation  needed  to  pay  the  interest.  The 
same  was  true  of  England  at  the  close  of  the  great 
Napoleonic  war  with  France  at  the  beginning  of  the 
last  century  which  had  almost  exhausted  the  credit  of 
the  country,  paralysing  its  industries,  and  increasing 
the  misery  of  the  poorer  classes  of  its  people;  and  yet 
in  neither  case  was  the  national  debt  nearly  so  heavy 
as  that  of  New  Zealand  to-day  in  proportion  to  the  pop- 
ulation. In  that  young  country  the  annual  charge  for 
interest  on  the  debt  of  the  nation  comes  to  as  nearly  as 
possible  £2.2  (or  $10)  for  every  man,  woman,  and  child 
in  the  country,  with  an  additional  fifty  cents  (or  two 
shillings)  for  each  to  provide  a  sinking  fund. 

It  may  sound  ridiculous  to  say  that  in  the  case  of 
New  Zealand  the  burden  is  not  a  heavy  one,  and  yet 
this  is  literally  true  —  it  is  not  felt  by  the  people  at  all. 
The  explanation  is,  after  all,  very  simple  indeed;  and 
the  difficulty  that  so  many  of  the  people  who  undertake 
to  speak  and  vmte  about  it  have  in  understanding  it  is 
caused  by  the  fact  that  they  have  not  taken  the  trouble 


EXPERIMENTS  IN  FINANCE  141 

to  grasp  what  it  means.  The  national  debts  of  nations 
whose  government  is  carried  on  upon  what  are  supposed 
to  be  orthodox  lines  of  political  economy,  have  almost 
invariably  represented  money  that  was  thrown  away  on 
objects  that  not  only  did  not  pay  in  themselves,  but 
usually  involved  great  loss  in  other  ways;  the  money 
borrowed  by  New  Zealand  to  carry  out  a  policy  of  State 
Socialism  has  been  money  well  invested,  which  has  not 
only  paid  for  itself,  but  has  at  the  same  time  increased 
the  wealth  of  the  whole  Community. 

The  people  of  New  Zealand  owe  the  public  creditors 
of  the  country  a  sum  of  money  to-day  equal  to  about 
$350  (£72)  for  every  white  man,  woman,  and  child, 
in  the  Dominion.  Of  this  amount  nearly  $30  (£6) 
may  be  said  to  be  a  real  burden,  as  it  represents  money 
that  was  spent,  directly  or  indirectly,  in  fighting  the 
native  tribes,  in  the  two  wars  that  occurred  in  the  early 
years  of  the  colony.  The  wars,  indeed,  could  hardly 
have  been  avoided,  if  the  country  was  to  be  settled  at  all, 
but,  like  other  war  loans,  the  money,  which  was  raised 
with  difficulty  at  high  interest,  never  made  any  direct 
return  to  the  people  that  borrowed  it.  In  this  respect 
these  early  loans  were  only  like  other  national  debts 
that  have  given  borrowing  by  Governments  a  bad  name ; 
and  it  says  much  for  the  common-sense  of  the  people  of 
New  Zealand  and  their  representatives  in  Parliament, 
that  in  their  later  borrowing  transactions  they  have  not 
repeated  the  mistake. 

Up  to  the  year  1891  no  policy  that  could  be  fully 
identified  with  State  Socialism  had  been  adopted  in 
New  Zealand ;  but  it  must  be  admitted  that  in  the  twenty 


142     SOCIAL  WELFARE  m  ITEW  ZEALA]!TD 

years  between  18 Yl  and  1891  a  good  many  things  had 
been  done  by  the  Government  that  were  unusual  in 
older  countries,  and  no  doubt  had  the  effect  of  training 
public  sentiment  in  the  direction  of  a  definite  policy  of 
interference  by  the  State  with  matters  that  were  else- 
where considered  beyond  the  sphere  of  public  control. 
Erom  the  first  settlement  of  the  country  there  had  been 
a  post  office  department  in  ISTew  Zealand  under  the  con- 
trol of  the  Government,  but  this  was  no  more  than  ex- 
isted in  America  and  England,  and  indeed  in  every  civil- 
ised country  in  the  world,  though  it  is  no  easy  matter 
to  distinguish  its  operation  from  any  ordinary  com- 
mercial undertaking.  In  ISTew  Zealand,  however,  it  had 
been  found  necessary  to  go  farther  than  in  older  coun- 
tries. There  the  land  of  the  country  was  admittedly 
the  property  of  the  native  tribes,  and  could  only  be 
bought  from  them  by  the  Government,  so  that  a  Land 
Purchase  Department  was  needed,  and  the  Government 
became  both  the  buyer  and  seller  of  the  land  required 
for  settlement.  As  the  settlement  of  the  land  extended 
to  a  greater  distance  from  the  markets  and  ports  the 
question  of  communication  naturally  became  an  im- 
portant one,  and  the  question  of  railroad  building  to 
enable  the  settlers  to  bring  the  produce  of  their  lands 
to  a  market,  forced  itself  on  the  attention  of  the  Gov- 
ernment. There  were  but  few  white  settlers  in  the 
colony  then,  and  these  were  scattered  thinly  over  the 
country;  it  was  certain  that  nobody  would  build  rail- 
roads in  ISTew  Zealand  as  a  commercial  speculation.  If 
the  country  wanted  railroads  it  was  certain  the  colony 
must  build  them  for  itself.     It  had  been  discovered  that 


EXPERIMENTS  m  EINANCE  143 

English  capitalists,  who  were  not  willing  to  risk  their 
money  in  the  speculation  of  building  and  operating  rail- 
roads in  so  new  a  colony,  could  be  induced  to  lend  their 
capital  to  the  colony  to  enable  the  settlers  to  do  it  for 
themselves.  In  this  way  the  'New  Zealand  Government 
was  almost  forced  to  go  into  the  business  of  railroad  con- 
struction, and  add  a  Railway  Department  to  the  other 
branches  of  the  public  business. 

The  first  really  large  financial  operations  of  ISTew 
Zealand  as  a  nation  were  connected  with  its  railroads. 
Money  had  been  borrowed  before  to  pay  the  exj^ense  of 
the  wars  with  the  natives,  and  some  —  though  not  a  very 
great  sum,  had  been  borrowed  to  buy  land  for  settlement 
from  the  tribes  ;  it  was  only  when  a  policy  of  opening  up 
the  country  by  railroads  had  been  decided  on  that  New 
Zealand  became  a  heavy  borrower  in  the  English  money 
market.  There  were  only  about  a  quarter  of  a  million 
of  white  men  in  the  colony  when  railway  building  was 
begim,  and  at  the  time  the  public  debt  of  these  250,000 
settlers  —  most  of  it  representing  money  spent  on  war 
that  brought  in  nothing  —  amounted  to  about  $37,000,- 
000  (£7,600,000),  that  is  to  say  nearly  a  hundred 
and  fifty  dollars  per  head  of  the  whole  population  that 
was  nearly  all  wasted,  or  at  any  rate  brought  in  no  re- 
turn in  money.  This,  it  may  very  naturally  be  sup- 
posed, might  have  appeared  to  be  a  sufiicient  national 
debt  for  so  small  a  people,  but,  having  once  decided  on 
a  policy  of  railroad  building,  neither  the  Government 
nor  people  hesitated  to  carry  it  out  with  energy.  The 
construction  of  railways  and  harbours  in  many  parts 
of  the  world  were  familiar  ideas  in  the  English  money 


144     SOCIAL  WELFARE  IN"  NEW  ZEALAND 

market  at  that  time,  and  it  was  found  that  for  sucli 
purposes  money  could  be  got  without  much  difficulty, 
especially  with  the  guarantee  of  the  colony  added,  and 
in  the  twenty  years  between  18Y1  and  1891  New  Zealand 
had  added  about  a  hundred  and  five  million  dollars 
(£22,000,000)  to  its  national  debt. 

Unlike  the  case  of  the  first  thirty-five  million  dollars 
which  the  young  colony  had  borrowed,  the  hundred  and 
five  additional  millions  had  not  been  spent  on  objects 
that  made  no  return  for  the  money  spent.  About 
eighty-five  millions  had  been  spent  on  the  railroads,  and 
there  were  1842  miles  built  and  in  operation  by  the 
end  of  1890,  opening  up  many  thousands  of  square  miles 
of  rich  country  for  settlement  that  could  not  have  been 
settled  without  it.  Several  millions  of  acres  of  good 
land  had  been  bought  from  the  native  tribes,  and  could 
be  bought  on  easy  terms  of  deferred  payment  by  in- 
tending settlers,  or  could  be  taken  on  perpetual  lease 
by  them  from  the  nation,  on  condition  that  the  lease- 
holders lived  on  the  land  and  cultivated  it.  Large  sums 
had  been  used  for  the  improvement  of  the  best  harbours 
on  the  coast,  the  interest  of  which  was  collected  as 
harbour  dues  and  wharfage  rates  by  the  local  author- 
ities, and  paid  into  the  Treasury  of  the  Colonial  Gov- 
ernment. At  first,  it  is  true,  the  railroads  didn't  pay 
the  full  interest  on  the  money  they  had  cost,  but  to 
make  up  for  that  they  increased  the  value  of  the  land 
and  the  prosperity  of  the  settlers ;  and  the  new  settlers 
who  had  been  helped  with  part  of  the  borrowed  money 
to  come  to  the  coimtry  were  able  to  settle  on  the  land, 


EXPEEIME^^TS  IN  FINANCE  145 

and  gradually  to  pay  the  colony  back  the  money  it  had 
advanced  for  them. 

This  was  the  state  of  affairs  in  1891,  when  the  policy 
of  definite  State  Socialism  may  be  said  to  have  been  in- 
troduced into  New  Zealand.  The  people  had  discov- 
ered that  it  was  quite  possible  for  a  Government  to  do 
a  good  many  things  for  the  country  with  success  that 
could  not  have  been  done  without  them,  which  developed 
their  country,  and  helped  the  settlers  to  greatly  in- 
creased prosperity.  They  had  learned  to  believe  that 
other  things  besides  Post  Offices  could  be  successfully 
managed,  and  honestly  administered  by  a  Government 
for  a  nation ;  and  that  the  whole  Community  might  be  a 
great  gainer  in  many  ways  by  leaving  matters  in  their 
hands,  rather  than  by  handing  them  over  to  corpora- 
tions, whose  one  object  would  be  to  make  large  profits 
that  must  come  out  of  the  pockets  of  the  rest  of  the 
people.  It  was  such  experiences  as  these  that  make  it 
possible  for  the  Government  and  people  of  New  Zea- 
land to  enter  on  a  policy  that  set  at  defiance  most  of 
the  settled  prejudices  of  the  commercial  world,  and  to 
proceed  farther  in  a  financial  policy  that  was  de- 
nounced on  every  side  as  ridiculous,  and  all  but  insane. 

When  the  policy  of  railway  constiiiction  by  the  Com- 
munity was  set  on  foot  there  were  almost  exactly  two 
hundred  and  fifty  thousand  white  people  in  the  colony ; 
in  twenty  years  their  number  had  increased  to  about  six 
hundred  and  forty  thousands.  The  experiment  of  pub- 
lic borrowing  on  a  large  scale,  and  using  the  money  for 
the  construction  of  public  works  that  seemed  likely  to 


146      SOCIAL  WELFAEE  m  KEW  ZEALAND 

benefit  the  public,  bad  been  so  far  a  success  that  tbe  tax- 
ation per  head  on  the  people  was  actually  less,  and  was 
greatly  less  felt,  than  it  had  been  when  the  national 
debt  represented  very  little  besides  the  cost  of  two 
ruinous  wars  —  it  appeared  at  least  possible  that  more 
money  might  be  profitably  borrowed,  and  used  for  pur- 
poses that  were  likely  to  develop  the  country,  and  ad- 
vance the  welfare  of  the  people. 

The  definite  policy  of  State  Socialism  involved  —  as 
it  probably  must  in  all  cases  involve,  to  a  greater  or  less 
degree, —  the  continuance  of  borrowing  by  the  State 
some  of  the  capital  held  by  individuals  for  public  uses. 
From  year  to  year,  since  1891  money  has  been  required 
in  New  Zealand  for  carrying  out  railway  building,  tele- 
graph and  telephone  installation,  and  harbour  works, 
and  in  each  case  the  money  has  been  obtained  by  means 
of  loans  raised  in  London.  During  these  twenty  years 
the  colony  has  borrowed  nearly  a  hundred  and  ninety 
million  dollars  —  £39,000,000 — while  it  has  paid  off 
about  three  million  pounds  ($15,000,000)  of  the  public 
debt,  which  had  become  due.  Thus  the  public  debt  has 
actually  increased  by  a  sum  of  $175,000,000  (£36,- 
000,000)  in  twenty  years.  In  the  meantime  the  popu- 
lation has  increased  by  fully  one-third,  and  as  the 
later  loans  have  been  negotiated  on  better  terms  than 
the  earlier  ones,  the  increased  indebtedness  per  head 
of  the  population  for  interest  has  not  been  very  great. 
This,  however,  is  a  matter  of  small  importance,  as  the 
interest  does  not  fall  upon  the  general  public  at  all,  but 
on  those  who  receive  the  direct  benefit  of  the  loan  ex- 
penditure. 


EXPERIMEIn^TS  IjST  finance  147 

About  one-third  part  of  the  loans  of  the  last  twenty 
years  has  been  spent  on  the  railroad  system  of  the  coun- 
try, which  has  been  extended  about  twelve  hundred 
miles  during  the  period,  and  now  represents  a  main 
trunk  line  extending  from  north  to  south  through  the 
two  islands  forming  the  Dominion  of  New  Zealand, 
with  branch  lines  to  the  principal  ports  on  both  sides. 
Dividends  were  never  from  the  first,  the  object  kept 
mainly  in  view  in  the  construction  of  the  New  Zealand 
railroads ;  and  it  need  hardly  be  said  that  the  introduc- 
tion of  a  system  of  definite  State  Socialism  has  rendered 
any  such  idea  still  more  unlikely  to  be  accepted  by  the 
people,  or  the  Government.  The  rule  in  these  later 
years,  as  formerly,  has  been  that  railway  rates,  both  for 
passengers  and  goods,  should  be  regulated  from  time  to 
time  on  the  principle  that  the  returns  from  the  railroads 
themselves  should  be  sufficient  to  pay  all  expenses  of  op- 
erating the  lines,  the  interest  payable  by  the  public  on 
the  money  borrowed  for  railway  construction,  and  a  re- 
serve sufficient  to  provide  for  keeping  both  the  lines  and 
the  rolling  stock  in  good  condition.  This  rule  has  been 
adhered  to,  and  the  returns  of  revenue  from  the  rail- 
roads are  fully  sufficient,  year  by  year,  to  pay  all  the 
cost  of  the  service,  and  even  to  improve  both  the  lines 
and  the  rolling  stock  in  use. 

The  great  extension  of  the  telegraph  lines,  as  well  as 
the  practical  installation  of  a  telephone  system  has  also 
been  paid  for  out  of  loans,  and  the  interest  on  the  ex- 
penditure has  been  paid,  in  addition  to  all  costs  of  op- 
eration, out  of  the  revenue  derived  from  the  service 
itself,  which,  it  may  be  noted  in  passing,  is  by  far  the 


148     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

cheapest,  and  tlie  most  generally  used,  of  any  similar 
service  in  any  part  of  the  world.  It  may,  of  course,  be 
pointed  out  that  both  the  railroads  and  telegraphs  were 
in  existence  in  New  Zealand  before  the  country  com- 
mitted itself  definitely  to  a  policy  which  interfered 
with  private  enterprise  to  an  extent  unknown,  in  other 
countries,  and  that  the  question  of  real  importance  is 
how  far  borrowed  money  spent  on  these  new,  and 
hitherto  untried  experiments  should  operate  as  a  burden 
on  the  people  at  large.  There  is,  it  may  be  admitted, 
reason  in  the  argument  which  calls  on  New  Zealand  to 
account  for  the  expenditure  of  about  a  hundred  and  ten 
million  dollars  (£23,000,000)  in  twenty  years  on  new 
experiments  in  government. 

New  Zealand's  largest  investment  of  borrowed  money 
during  the  last  twenty  years  has  been  made  in  the  pur- 
chase of  lands  previously  sold  by  the  State  to  private  in- 
dividuals or  companies,  and  held  by  them,  as  a  rule,  in 
the  prospect  of  either  selling  it  eventually  at  greatly  in- 
creased prices  to  the  people  that  wished  to  settle  on,  and 
cultivate  it,  or  letting  it  on  lease  to  tenants  at  high  rents 
when  the  demand  for  agricultural  land  should  become 
so  great  that  settlers  would  be  found  willing  to  take  it 
on  such  terms.  As  we  have  already  seen  the  Parlia- 
ment decided  that  such  holding  of  large  areas  of  land 
for  speculative  purposes  was  injurious  to  the  nation, 
and  by  statute  authorised  the  Government  to  take  any 
such  estates,  at  a  valuation,  as  soon  as  a  sufficient  num- 
ber of  settlers  declared  themselves  willing  to  lease  the 
land  in  farms  of  not  more  than  three  hundred  and 
twenty  acres  each  from  the  Government,  paying  a  rental 


EXPERIMENTS  IK  FINANCE  149 

of  four  per  cent,  on  the  price  paid.  Eor  sucli  lands 
the  Government  has  paid  in  the  twenty  years  the  large 
sum  of  fully  $30,000,000  under  the  provisions  of  the 
statute  for  compulsory  purchase  of  land  for  closer  set- 
tlement. It  need  hardly  be  pointed  out  that  as  the 
Government  can  only  purchase  such  lands  when  a  suffi- 
cient number  of  suitable  persons  have  petitioned  for  the 
purchase,  agreeing  to  lease  it  from  the  Government 
when  acquired,  at  a  rental  which  leaves  a  margin  of 
one-half  per  cent,  beyond  the  interest  paid  by  the  coun- 
try on  its  loans,  no  burden  is  cast  on  the  general  public 
by  the  existence  of  loans  incurred  for  this  purpose. 

A  second  sum  of  more  than  $38,000,000  (£7,800,000) 
has  been  spent  in  making  advances  to  settlers  on  the 
terms  authorised  by  the  statute,  for  the  purpose  of  re- 
ducing the  burden  of  interest  usually  charged  on  such, 
loans  by  private  capitalists  and  companies,  the  opera- 
tion of  which  has  been  already  explained  at  length.  As 
the  advances  can  only  be  made  after  independent  val- 
uation, and  are  limited  to  a  certain  proportional  value 
on  the  property  mortgaged  to  the  Government,  it  is  evi- 
dent that  nothing  short  of  a  large  and  general  de- 
preciation in  the  value  of  agricultural  land  could  throw 
any  burden  of  interest  on  the  community  at  large  in  re- 
spect of  such  loans.  The  further  question  of  the  gen- 
eral effect  on  the  progress  and  prosperity  of  the  coun- 
try is  one  to  which  we  shall  return  hereafter;  for  the 
present  purpose  it  is  sufficient  to  show  that  the  in- 
terest of  loans  that  are  spent  on  this  second  experi- 
mental interference  with  the  operations  of  capitalists, 
does  not  cast  any  immediate  burden  on  the  Community, 


150     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

while  it  relieves  the  settlers  on  the  land  of  a  weight  of 
interest  that  in  New  Zealand,  as  in  America,  has  too 
often  proved  a  crushing  burden. 

Of  the  remaining  fifty-two  million  dollars  (£10,500,- 
000)  still  to  be  accounted  for  out  of  the  public  debt  in- 
curred during  the  last  twenty  years  by  the  people  of 
New  Zealand,  $17,000,000  (£3,550,000)  has  been  ad- 
vanced to  local  bodies,  for  harbour,  and  other  public 
works  at  a  rate  of  interest  lower  than  that  at  which  these 
bodies  could  themselves  have  obtained  the  money,  thus 
relieving  the  local  city  and  harbour  revenues  of  a  need- 
less burden.  About  $7,000,000  (£1,750,000)  have  been 
invested  in  the  purchase  and  improvement  of  native 
lands  for  settlement.  These  lands,  when  disposed  of 
will,  even  if  they  should  not  contain  valuable  mineral 
deposits  of  coal  and  metals,  as  they  very  likely  may,  will 
certainly  return  to  the  public  Treasury  all  that  has 
been  expended,  including  both  principal  and  interest. 
About  $5,000,000  has  been  expended  in  advances  to 
workers  to  enable  them  to  make  homes  for  themselves 
and  families,  on  terms  that  secure  the  public  from  loss 
while  they  benefit  a  large  and  most  important  part  of 
the  nation  by  relieving  them  of  heavy  rents  at  present, 
and  by  setting  before  them  an  attainable  condition  of 
well-being  in  the  future  for  themselves  and  families. 

Five  million  dollars  were  employed  in  the  purchase 
of  the  only  railroad  in  New  Zealand  that  has  ever 
been  constructed  and  operated  by  private  enterprise. 
This  railroad  formed  a  natural  part  of  the  system  of 
public  railroads,  and  was  eventually  bought  at  a  val- 
uation to  avoid  the  necessity  of  building  a  line  that 


EXPEKIMENTS  IN  FIISTANCE  151 

would  practically  have  competed  with,  and  eventually 
ruined  the  property  of  the  company  that  had  con- 
structed it  at  a  time  when  it  was  a  real  benefit  to  the 
public.  The  extension  of  telegraph  and  telephone  lines 
was  responsible  for  about  four  million  dollars,  and  the 
erection  of  public  buildings,  including  post  offices,  court 
houses,  and  terminal  stations  at  the  chief  cities  on  the 
railway  lines,  as  well  as  the  development  of  the  Gov- 
ernment coal  mines  and  a  number  of  other  smaller  ad- 
vances and  expenditures  on  various  objects  —  all,  or 
very  nearly  all, —  calculated  to  return  not  only  the  ex- 
pense of  operation  but  the  full  interest  for  which  the 
public  Treasury  was  primarily  responsible  to  the  credit- 
ors of  the  country. 


CHAPTER  X 

NEW  Zealand's  state  socialism 

The  policy  of  'New  Zealand,  a  sketch  of  which  as 
expressed  in  the  legislation  of  the  country,  has  been 
attempted  in  the  preceding  chapters,  may  perhaps  be 
most  fairly  characterised  as  a  policy  of  State  Socialism. 
Socialism  of  any  kind  is  comparatively  a  new  departure 
in  either  political  or  economic  thought,  which  may  be 
said  to  be  the  product  of  the  last  hundred  years,  and 
in  its  more  definite  forms  probably  of  the  last  fifty.  As 
might  have  been  expected  the  new  ideas  that  have  been 
classed  under  the  general  name  of  socialism  have  taken 
many  forms,  influenced  by  the  personality  and  sur- 
roundings of  the  various  apostles  of  the  new  political 
and  economic  faith,  and  there  is  a  danger  that  the  word 
"  socialism,"  wherever  used,  may  be  understood  differ- 
ently by  those  who  meet  with  it.  Even  the  safeguard 
that  links  it  with  another  word  by  way  of  limitation, 
may  not  always  prevent  misunderstanding,  as  there  may 
be  persons  in  the  ranks  both  of  socialists  and  anti- 
socialists  who  are  ready  to  seize,  either  for  praise  or 
blame,  on  the  familiar  term,  and  to  lose  sight  of  the 
special  limitations  involved  in  its  compound.  Under 
these  circumstances  it  may  be  well  to  prevent  misun- 
derstanding by  saying  something  in  explanation  of  the 

152 


N'EW  ZEALAND'S  STATE  SOCIALISM     153 

sense  in  which  the  term  State  Socialism  is  used  in  this 
book  as  applicable  to  the  social  and  political  ideals  and 
experiences  of  Xew  Zealand. 

The  policy  that  has  distinguished  the  legislation  and 
administration  of  Xew  Zealand  from  that  of  any  other 
civilised  and  self-governing  country  during  the  past 
twenty  years  has  never  received  any  special  title  in  the 
country  itself ;  and  it  may  be  doubted  whether  either  of 
the  two  men  who  were  mainly  responsible  for  its  intro- 
duction thought  of  it  under  any  such  name,  or  even 
regarded  the  legislation  as  part  of  any  complete  sys- 
tem at  all.  It  is  more  than  likely,  indeed,  that  could 
either  of  these  men  have  foreseen  the  changes  that  would 
be  gradually  introduced  as  the  really  logical  results 
of  their  first  experiments  they  would  have  hesitated  to 
enter  on  a  policy  so  far-reaching,  and  so  unexampled  in 
the  history  of  nations.  And  whether  this  estimate  of 
the  men  who  introduced  the  policy,  and  developed  it 
year  after  year  by  new  laws  that  seemed  to  follow  one 
another  in  an  almost  inevitable  succession,  is  correct 
or  not,  it  is  certainly  true  of  the  people  at  large.  Cir- 
cumstances that  had  led  gradually  to  the  adoption  of  a 
certain  course  in  the  legislation  seemed  to  lead  on  per- 
sistently from  one  step  to  another,  till  that  which  at 
first  would  have  appeared  strange  and  revolutionary  be- 
came natural,  and  even  necessary.  The  secret  of  the 
progress  of  'New  Zealand's  policy,  which  to  people  at  a 
distance  has  looked  so  strangely  persistent  and  obstinate, 
may  be  foimd  not  in  any  definite  theories  of  politics  or 
social  ideals,  but  in  a  very  simple  underlying  principle 
which  the  conditions  of  the  country  and  its  people  com- 


154     SOCIAL  WELFARE  m  NEW  ZEALAND 

mended  to  the  communitj  as  a  wholly  natural  thing. 
That  principle  was  the  absolute  supremacy  of  the  peo- 
ple, as  an  undivided  whole. 

In  the  older  European  countries,  burdened  with  the 
traditions  of  long  centuries  of  the  semi-barbarism  which 
romantic  sentiment  has  clothed  with  ideal  attractions, 
it  was  perhaps  natural  that  the  real  unity  of  a  nation 
should  be  a  name  and  in  reality  nothing  but  a  name. 
In  America  the  relics  of  the  same  traditions,  and  the 
sudden  development  of  the  new  spirit  of  unbridled  com- 
mercialism, have  gone  very  far  to  produce  the  same  re- 
sults. In  a  country  as  young  and  as  isolated  in  posi- 
tion as  New  Zealand,  where  the  early  settlers  were 
brought  face  to  face  with  conditions  that  were  com- 
paratively primitive,  and  where  as  yet  the  spirit  of 
modem  commercialism  could  hardly  be  said  to  have 
taken  root  at  all,  it  was  natural  that  the  point  of  view 
on  all  questions  of  public  interest  should  be  different. 
In  such  a  community  there  was  little  or  no  room  for 
the  old  traditions  that  split  up  a  nation  into  classes; 
and  where  all,  or  nearly  all  were  workers,  uncontami- 
nated  by  a  leisure  class,  there  was  little  to  encourage 
the  money  worship  which  under  the  reign  of  unbridled 
commercialism  has  shown  itself  capable  of  producing 
very  similar,  and  in  some  respects  more  unpardonable 
abuses.  It  is  not,  therefore,  claimed  for  either  the  lead- 
ers or  the  people  of  New  Zealand  that  they  have  de- 
veloped lofty  ideals  of  society,  or  of  government,  on 
any  high  philosophic  plane.  It  is  not  even  claimed  that 
they  intentionally  built  up  a  policy  more  ideally  ad- 
vanced  than   that   of  older   and   larger   communities. 


I^EW  ZEALAND'S  STATE  SOCIALISM     155 

All  that  is  claimed  is  that  by  a  very  natural  process  of 
development  the  point  of  view  of  the  people  of  New 
Zealand  became  a  really  social  one,  and  the  benefit  and 
advantage  of  all  the  members  of  the  community,  and 
especially  of  those  who,  for  the  time  at  least,  seemed  to 
have  the  fewest  advantages,  should  be  the  first  consid- 
eration in  the  law-making  of  the  young  country.  It 
had  been  the  dream  of  some  of  the  founders  of  the 
colony,  indeed,  at  first  to  reproduce  the  old  social  and 
political  conditions  of  England  in  the  new  colony ;  but 
circumstances  had  within  a  few  years  shown  conclu- 
sively that  it  was  only  a  dream ;  and  New  Zealand  be- 
came perhaps  the  most  entirely  democratic  in  feeling 
of  civilised  countries. 

The  State  Socialism  of  the  country  has  been  the 
natural  consequence  of  this  feeling.  It  has  meant 
changes  in  the  laws  and  administration  of  the  country 
that  may  without  injustice  be  called  revolutionary.  A 
very  superficial  acquaintance  with  the  laws  of  England 
should  convince  anybody,  that  for  many  hundreds  of 
years  the  protection  of  property,  and  not  the  advance- 
ment of  human  well-being, —  least  of  all  the  well-being 
of  the  great  majority  of  the  nation  that  possessed  the 
smallest  fragments  of  it  —  has  been  its  chief  object. 
The  property  of  the  small  class  that  owned  the  land; 
afterwards  the  property  of  the  somewhat  larger  class  of 
merchants  and  artisans;  finally  that  of  the  classes  — 
knovra  by  the  name  of  "  middle  classes,"  upper  and 
lower,  who  had  by  some  means  or  other  secured  money, 
—  the  protection  of  the  property  of  these  monopolised 
the  pages  of  England's  statute  books,  as  it  monopolises 


156      SOCIAL  WELFAEE  IN  NEW  ZEALAND 

them  still.  Tlie  idea  tliat  men,  and  not  money,  were 
the  all-important  considerations  for  a  nation's  statutes; 
the  conviction  that  the  interests  of  the  many,  and 
not  merely  of  the  few,  were  the  important  subjects  for 
the  consideration  of  the  nation's  Parliament, —  these 
constituted  the  groundwork  of  the  novel  legislation  of 
New  Zealand;  and  the  attempt  to  give  practical  effect 
to  these  ideas  and  convictions  was  the  basis  of  the 
policy  of  State  Socialism  as  practised  in  New  Zea- 
land. 

This,  it  may  be  frankly  admitted,  is  revolutionary. 
It  ignores  old  social  traditions ;  it  upsets  old  social  ar- 
rangements. It  declines  to  subscribe  to  the  old  con- 
clusion of  barbarism  that  the  strongest  —  whether  in 
brute  force  or  in  intellectual  keenness, —  is  the  best,  and 
the  most  worthy  of  attention.  It  denies  the  existence 
of  classes  among  the  members  of  a  community,  except 
as  the  result  of  selfish  conditions  of  long  standing,  that 
are  really  a  disgrace  to  the  nation  that  permits  them  to 
continue,  and  a  drawback  to  its  wealth  as  a  commimity. 
It  denies  that  any  part  —  and  most  emphatically  of  all 
any  small  part  —  of  a  nation  can  have  any  sort  of 
Divine  Eight  to  a  monopoly  of  those  things  that  make 
life  worth  living,  and  give  to  civilised  life  any  real  ad- 
vantage over  that  which  is  savage. 

The  socialism  that  dreams  of  a  gTeat  social  convul- 
sion, by  which  the  poor  may  become  suddenly  rich,  and 
the  rich  comparatively  poor,  has  found  no  place  in  the 
social  idealism  of  New  Zealand,  nor  has  it  ever  been 
advocated  by  any  party  in  the  country.  The  familiar 
argument  of  the  extreme  socialist,  which  condemns  aU 


NEW  ZEALAND'S  STATE  SOCIALISM      157 

riches  as  the  product  of  injustice  and  oppression,  has 
called  forth  no  enthusiasm  in  New  Zealand,  the  people 
of  the  joung  Dominion  being  more  interested  in  try- 
ing to  remedy  social  evils  than  in  discussing  the  causes 
that  have  led  to  them.  The  advance  of  general  educa- 
tion has  led  them  to  see  that  great  and  sudden  changes 
are  always  dangerous,  and  generally  disastrous,  and 
has  taught  them  to  believe  that  in  the  world  of  political 
and  social  conditions,  as  in  that  of  nature,  it  is  the 
plant  of  gradual  and  steady  growi;h  that  lives  longest, 
and  proves  most  useful.  Thus  the  legislation  of  New 
Zealand,  while  it  has  been  unique,  has  avoided  great 
and  sudden,  changes.  It  has  attempted  no  confisca- 
tion of  the  property  of  the  rich,  and  no  sudden  enrich- 
ment of  the  poor.  Its  advocates  have  preached  no  so- 
cial crusades  against  those  who  have  either  acquired  or 
inherited  wealth,  but  have  contented  themselves  with 
the  enactment,  year  after  year,  of  laws  intended,  on  the 
one  hand  to  increase  the  wealth  of  the  poor,  by  assist- 
ing them  to  better  conditions,  and  on  the  other  by  dis- 
couraging the  accumulation  of  riclies  in  the  hands  of 
those  who  already  have  enough.  It  has  recognised  the 
right  of  every  member  of  the  community  to  at  least 
the  opportunity  of  obtaining  well-being  for  himself  and 
for  these  dependent  on  him ;  and  it  has  emphasised  the 
duty  of  the  State  to  see  that  his  rights  in  this  respect 
are  not  interfered  with  by  those  who  have  capital. 
With  this  in  view  it  has  ignored  the  old  doctrines  of 
free-trade  in  labour,  and  insisted  on  a  readjustment  of 
the  social  and  economic  relations  of  capital  and  labour, 
by  referring  all  questions  of  work  and  wages  to  the  de- 


158      SOCIAL  WELFAKE  m  NEW  ZEALAND 

cision  of  an  independent  Court,  while  denying  to  either 
party  to  such  disputes  the  privilege  of  becoming  judges 
in  their  own  case,  or  of  sacrificing  the  general  interests 
of  the  community  to  the  old  belligerent  instincts  which 
men  supposed  to  be  civilised  still  share  with  the  tiger 
and  the  gorilla,  where  their  passions  or  their  supposed 
interests  are  at  stake. 

To  accomplish  these  things,  it  need  hardly  be  said, 
it  has  been  found  necessary  to  do  many  things  that 
have  not  been  done  in  other  countries,  where  the  objects 
kept  in  view  have  been  different.  As  long  as  property, 
and  not  human  beings,  and  their  well-being,  were  the 
main  considerations  in  the  eyes  of  legislators  it  was  in- 
evitable that  class  legislation  must  be  the  rule,  and 
everything  else  the  exception.  As  soon  as  the  posi- 
tion was  reversed  the  alteration  in  the  whole  field  of 
law-making  was  necessarily  so  great  as  to  appear,  and 
to  some  extent  actually  to  be,  revolutionary.  The 
change,  so  often  and  so  freely  made,  against  the  policy 
of  New  Zealand  has  generally  been  that  it  amounted  to 
a  selfish  policy  of  plunder,  by  which  the  workers  of  the 
nation,  and  those  of  the  community,  who,  owing  to  the 
inferiority  in  energy  or  intelligence,  either  of  them- 
selves or  their  ancestors,  had  little  or  no  property,  pro- 
posed to  share,  if  not  to  confiscate  to  their  own  use 
entirely  the  wealth  laboriously  accumulated  by  their 
betters.  The  prophecy  almost  invariably  uttered  by 
the  critics  of  that  policy  has  been,  that  it  must  and 
would  lead,  within  a  very  short  time  to  economic  fail- 
ure, and  social  disaster. 

The  instances  that  are  generally  brought  forward  in 


NEW  ZEALAND'S  STATE  SOCIALISM     159 

support  of  the  charge  of  unprincipled  selfishness,  em- 
brace the  policy  dealing  with  the  land  of  the  country, 
by  which  large  estates,  held  either  by  individuals  or 
coi'porations,  may  be  at  any  time  taken  from  them, 
without  the  permission  of  the  owners  who  bought  and 
paid  for  them,  and  divided  into  comparatively  small 
farms  to  be  occupied  by  settlers  who  had  little  or  no 
capital,  but  could  get  the  land  on  lease  at  a  rental  of 
four  per  cent,  on  what  the  Government  had  paid  for  it. 
Even  in  the  cases  in  which  the  land  was  not  taken 
from  its  owners,  it  was  said,  the  people  who  because 
they  had  capital  were,  as  every  reasonable  person  must 
admit,  the  real  backbone  of  the  country,  were  penal- 
ised by  having  heavy  taxes  imposed  on  them  year  after 
year  on  a  sliding  scale,  growing  heavier  as  their  estates 
increased  in  size,  till  it  became  a  serious  question 
whether  it  was  worth  while  to  keep  them  at  all. 

The  grievances  of  the  persons  and  corporations  whose 
capital  had  been  embarked  in  business  —  either  manu- 
facturing or  commercial  —  was  more  complicated,  but 
equally  serious.  They  too  were  heavily  taxed  on  the 
amount  of  the  income  derived  from  their  business,  and, 
as  if  this  was  not  enough,  they  were  not  allowed  to  em- 
ploy labour  at  the  rates  they  could  have  got  it  for  if 
they  had  been  left  to  manage  their  own  affairs,  but  at 
rates  fixed  by  a  court  —  which,  of  course,  in  such  a 
country  must  favour  the  workmen, —  besides  having  the 
hours  of  work-  cut  down  to  44  in  each  week,  with  pay- 
ment at  the  rate  of  time  and  half  for  every  extra  hour 
they  worked.  And,  as  if  even  this  was  not  a  sufficient 
handicap  on  capital,  the  people  or  Corporations  that 


160     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

had  money  to  invest  were  practically  prevented  from 
getting  decent  interest  for  its  use  by  Government  inter- 
ference. Seven  or  eight  per  cent,  was  little  enough  to 
charge  on  mortgage  of  farms,  and  ten  or  even  twelve 
per  cent,  was  surely  not  too  much  to  get  as  rent  for 
cottages  for  workmen,  when  the  owners  had  to  pay 
rates  and  taxes,  and  keep  the  places  in  repair;  and  yet 
the  Government  must  step  in,  and  offer  to  borrow  the 
money,  on  the  credit  of  the  country,  and  lend  it  again 
to  these  people  at  four  per  cent,  to  enable  them  to 
build  houses  for  themselves. 

These  are  fair  specimens  of  the  criticisms  and  com- 
plaints levelled  at  the  policy  pursued  in  New  Zealand 
for  the  last  twenty  years  from  the  outside,  by  a  class 
of  people  who  were  at  first  honestly  contemptuous  of 
the  foolish  theories  that  were  leading  the  people  of  the 
young  and  inexperienced  colony  into  these  childish  ex- 
periments, and  who  have  lately  grown  uneasy  as  year 
after  year  went  by,  bringing  no  evidence  of  the  catas- 
trophe that  was  to  convince  everybody  in  England  or 
America  that  the  policy  was  not  only  foolish  but  impos- 
sible. At  first  they  were  echoed  with  equal  emphasis, 
from  within  the  colony  itself,  by  the  people  who  had 
money  to  invest  in  land  for  speculative  purposes,  in 
business  for  large  profits,  or  in  mortgages  and  dwell- 
ing houses  returning  heavy  interest  on  the  outlay. 
After  doing  what  they  could  to  stem  the  current  of  pub- 
lic opinion  in  vain  in  the  country  itself,  this  class  of 
persons,  which  was,  after  all,  a  small  one,  compared 
with  the  mass  of  the  electors,  accepted  the  inevitable 


NEW  ZEALAND'S  STATE  SOCIALISM      161 

for  the  time,  with  a  shrug  of  the  shoulders  which  inti- 
mated their  conviction  of  inevitable  disaster.  In  this 
way  they  entered  their  protest,  and  have  since  then 
been  looking  forward  to  the  inevitable  failure  and  re- 
action, with  hardly  concealed  satisfaction.  In  the 
meantime,  however,  they  have  submitted,  and  the  sub- 
mission has  become  more  and  more  easy,  as  time  went 
on  and  the  expected  disasters  have  been  delayed,  till  it 
is  no  unusual  thing  to  find  those  who  a  few  years  ago 
had  no  good  word  to  say  for  the  policy,  forced  reluc- 
tantly to  admit  that  by  some  wholly  unexplainable  proc- 
ess it  appears  still  to  have  left  the  country  prosperous 
and  its  people  happy. 

All  this,  it  is  true,  does  not  get  rid  of  the  belief,  so 
firmly  held  by  the  teachers  and  disciples  of  the  so- 
called  science  of  political  economy,  that  any  such  policy 
must  fail  in  the  end,  because  it  is  contrary  to  their 
theories,  which  they  call  science.  Eor  a  time,  indeed, 
they  will  admit,  it  may  appear  to  have  some  success,  so 
far  as  to  allow  a  small  and  isolated  community  to  en- 
joy a  kind  of  stagnant  prosperity  calculated  to  impose 
on  the  thoughtless.  In  a  few  years  more,  however,  it 
is  sure  to  become  evident  that  the  prosperity,  stagnant 
as  it  was,  was  not  a  real  thing;  the  people  who  have 
had  everything  done  for  them,  which  they  should  have 
been  forced  to  do  for  themselves  under  the  lash  of  a 
fierce  competition,  will  have  manifestly  lost  energy  with 
the  loss  of  the  compelling  force  of  necessity;  the  coun- 
try will  be  seen  to  be  evidently  going  backwards,  and 
becoming  poorer  every  year  and  the  huge  debt  which  it 


162     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

has  been  piling  up  for  years  to  be  spent  in  foolish  and 
ignorant  experiments  will  be  felt  as  a  crushing  burden 
bj  its  people. 

As  all  real  knowledge  is  the  result  of  experience,  and 
all  human  foresight  can  only  be  of  value  in  so  far  as  it 
is  founded  on  what  we  know  of  the  past,  it  would  be  a 
waste  of  time  to  argue  on  the  outlook  of  New  Zealand's 
State  Socialism  as  an  abstract  theory  of  government. 
Fortunately  we  are  not  reduced  to  any  such  necessity, 
and  there  is  something  more  instructive  to  offer  those 
who  are  interested  in  the  advancement  of  the  well-being 
of  humanity  than  the  dogmatic  statements  of  prej- 
udiced opinion.  Twenty,  or  even  forty  years,  is  not  a 
long  period,  it  is  true,  in  the  life  of  a  nation,  but  they 
are  nearly  as  long  at  any  rate,  as  the  fully  developed 
life  of  the  new  science  of  political  economy,  which  is 
so  impatient  of  anything  that  seems  to  throw  a  doubt 
on  its  conclusions.  And  in  the  case  of  New  Zealand  we 
have  a  complete  record  of  what  has  been  done,  and  a 
full  statement  year  by  year,  of  its  effect  on  the  progress 
and  prosperity  of  its  people. 

In  the  next  part  of  this  book  it  is  proposed  to  trace 
the  working  of  the  various  experiments  already  re- 
ferred to,  and  to  state,  without  exaggeration  or  mis- 
representation, the  facts,  as  recorded  in  the  annual  sta- 
tistics of  the  country,  leaving  it  to  the  unprejudiced 
readers  of  this  book  to  draw  from  them  their  own  con- 
clusions as  to  the  success  or  failure  of  the  system 
adopted  by  New  Zealand,  and  to  consider  whether  it  is 
not  at  least  possible  that  it  may  form  an  object  lesson 
of  value  to  the  rest  of  the  world. 


BOOK  III 
WHAT  IT  HAS  MEANT  TO  NEW  ZEALAND 


CHAPTER  I 

NEW  ZEALAND  TWENTY  YEAES  AGO 

The  first  fifty  years  of  'New  Zealand's  history  as  a 
civilised  community  ended  in  1891.  The  half  century 
had  been  one  of  struggle  for  the  first  colonists  of  the 
new  country,  and  the  progress  made  had,  for  most  part, 
been  slow.  The  wars  with  the  natives  that  ended 
finally  in  1867  had  left  the  little  community  burdened 
with  a  heavy  debt;  the  policy  of  assisted  immigration, 
and  public  works  constructed  by  means  of  loans  raised 
in  England  on  the  security  of  the  public  credit,  had 
come  to  an  end,  and  had  been  followed  by  ten  years 
of  slow  progress,  which  held  out  little  prospect  of  ma- 
terial improvement  for  many  years  to  come.  In  some 
respects,  it  is  true,  the  young  colony  could  be  pointed  to 
as  a  success,  but  it  was  hardly  what  could  be  called  a 
commercial  success.  Its  people,  like  the  early  colonists 
of  America  two  centuries  before,  had  fought  a  stub- 
bom  fight  against  barbarism,  and  like  them  too  they 
had  won  in  the  end,  practically  by  their  own  exertions. 
They  had  emerged  from  the  period  of  struggle  a  self- 
reliant  people,  frugal  in  their  habits,  simple  in  their 
tastes,  and  prepared  to  believe  tliat  they  could  manage 
their  own  affairs  to  the  best  advantage  for  themselves 
without  external  interference  or  help.     England,  with 

165 


166     SOCIAL  WEL.FAEE  IN"  NEW  ZEALAND 

a  wise  forbearance,  whicli  her  rulers  had  probably 
learned  from  the  experiences  taught  by  the  Ameri- 
can revolution,  had  given  them  almost  from  the  first 
a  perfectly  free  hand  to  make  their  own  laws,  and  man- 
age their  own  affairs;  and  when  the  colonists  had 
proved  that  whether  in  war  or  in  peace  they  knew  how 
to  manage  the  natives,  better  than  strangers  —  civil  or 
military  —  could  do,  she  had  withdrawn  her  soldiers, 
and  left  native,  as  well  as  colonial  affairs  in  their 
hands. 

The  people  of  New  Zealand  were  in  most  respects 
more  English  than  any  other  of  Great  Britain's  mod- 
ern colonies;  the  earliest  colonists  came  entirely  from 
England  and  Scotland,  and  to-day  the  proportion  of 
the  people  who  are  of  any  other  than  British  descent 
is  very  much  less  than  in  any  other  part  of  the  empire. 
Except  during  the  few  years  between  1872  and  1878, 
while  the  policy  of  assisted  immigration  was  in  force, 
and  New  Zealand  had  money  to  spend  in  helping  set- 
tlers to  come  to  the  colony  who  could  not  have  borne 
the  expense  of  the  long  voyage  for  themselves  and 
families,  there  has  never  been  any  wave  of  immigra- 
tion into  the  country,  and  even  in  those  six  years  the 
new  population  amounted  to  less  than  a  hundred  and 
twenty  thousand  persons,  all  of  whom  were  selected 
either  in  Great  Britain  or  Ireland.  In  the  thir- 
teen years  between  1878  and  1891  the  total  increase  of 
population  by  immigration  amounted  to  no  more  than 
twenty-two  thousand  persons  —  about  fifteen  hundred 
in    each   year.     The  numbers   were   not   uniform,    of 


NEW  ZEALAl^D  TWENTY  YEARS  AGO     167 

course,  as  many  as  ten  thousand  having  arrived  in  one 
of  the  earlier  years  of  the  period,  and  fourteen  thou- 
sand having  drifted  away  to  Australia  during  the  last 
four  years  in  excess  of  the  new  arrivals. 

It  is  hardly  necessary  to  say  that  in  the  last  few 
years  before  1891  New  Zealand  was  not  a  popular  field 
for  immigration.  The  population  of  the  country,  how- 
ever, continued  to  increase  steadily,  in  consequence  of 
the  high  birth  rate  that  prevailed,  and  the  unusually 
small  percentage  of  deaths,  which  then  was  and  still  is 
characteristic  of  the  colony.  At  the  end  of  the  year 
1890  there  were  fully  625,000  white  inhabitants,  and 
of  these  at  least  three-fourths  had  been  bom  in  the 
country  itself,  so  that  the  people  of  New  Zealand  were 
undoubtedly  by  far  the  most  homogeneous  commimity 
of  any  offshoot  of  the  British  Islands.  This  population 
was  for  the  most  part  settled  on  the  land,  and  engaged 
in  farming.  There  were  at  the  time  only  four  cities 
containing  twenty  thousand  or  more  inhabitants, 
though  there  were  a  good  many  smaller  towns,  with  a 
population  of  from  one  to  five  thousand  inhabitants 
scattered  over  both  islands.  There  were  not,  of  course, 
many  manufactures  carried  on,  and  what  there  were 
were  conducted  on  a  limited  scale,  though  attempts  had 
been  made  during  the  years  of  comparative  stagnation 
to  establish  factories,  mainly  to  utilise  the  timber  and 
wool,  both  of  which  were  produced  in  great  variety 
and  of  remarkable  quality.  Ship-building  and  iron 
foundries  had  also  been  established  —  the  compara- 
tively low  wages  at  which  even  skilled  labour  could  be 


168      SOCIAL  WELFAEE  m  NEW  ZEALAND 

obtained,  and  the  exceptionally  low  cost  of  living, 
having  encouraged  some  capitalists  to  make  the  at- 
tempt. 

There  are  few  countries  in  which  the  advantages  of 
climate  are  equal  to  those  enjoyed  by  the  islands  of 
New  Zealand.  When  compared  with  a  climate  like 
that  of  Canada  it  is  easy  to  understand  its  advantages, 
especially  for  workers  whose  employment  calls  for  an 
out-of-doors  life.  A  New  Zealand  worker  can,  with- 
out any  hardship  or  risk  to  health,  carry  on  his  work 
in  the  open  air  on  almost  every  day  in  the  year — ■ 
losing,  it  may  be  five  or  six  wet  days  in  the  north,  and 
eight  or  ten  in  the  south  island,  and  this  may  account 
at  least  to  some  extent,  for  the  steady  progress  made 
by  the  colony  during  the  first  fifty  years  of  its  exist- 
ence in  spite  of  many  drawbacks  and  discouragements. 

The  conditions  of  New  Zealand  in  1891  may  be  said 
to  have  been  peculiar,  and  observers  might  be  pardoned 
if  they  felt  somewhat  doubtful  as  to  its  future.  The 
people  as  a  whole  were  certainly  not  wealthy,  though 
there  was  a  small  class  in  the  country  which  promised 
to  become  rich  owing  to  the  rise  in  value  of  the  land 
which  they  had  purchased  at  two  and  a  half  dollars 
(ten  shillings)  per  acre  in  large  areas.  Outside  this 
small  class  —  and  in  numbers  it  was  a  very  small  one 
compared  with  the  rest  of  the  population  —  it  may 
fairly  be  said  there  was  very  little  capital  belonging 
to  the  colony  itself.  What  capital  there  was  available 
either  for  loans  to  settlers  or  for  commercial  enter- 
prises came  generally  from  abroad,  and  belonged  either 
to  financial  companies  or  to  English  capitalists  who  had 


NEW  ZEALAND  TWENTY  YEAES  AGO     169 

friends  in  the  country.  On  the  other  hand  there  were 
a  great  many  of  the  settlers  who  had  enough  to  live  on 
in  frugal  comfort.  There  were  about  42,000  farms  in 
the  country  occupied  by  settlers,  and  most  of  the  land 
was  cultivated,  either  for  crops  or  pasture.  In  the  two 
islands  there  were  nearly  nine  million  acres  of  land 
cultivated  in  this  way,  making  an  average  of  about 
two  hundred  and  fifteen  acres  to  each  farm,  but  it  must 
be  admitted  that  at  the  time  a  very  large  proportion 
of  these  were  subject  to  mortgages  carrying  heavy  in- 
terest. 

Twenty  years  ago  therefore,  New  Zealand  was  not  a 
remarkably  prosperous  country,  nor  could  its  people  lay 
any  claim  to  consideration  as  a  community  of  wealthy 
people;  yet  it  was  one  that  possessed  many  natural  ad- 
vantages, while  most  of  its  people  lived  in  simple  com- 
fort. 

Under  the  circumstances  the  prospects  of  the  island 
colony  could  hardly  be  called  bright.  Its  people  had 
little  to  offer  strangers  that  appeared  likely  to  attract 
them  to  the  country  in  any  considerable  numbers,  and 
a  good  many  of  the  younger  and  more  adventurous  of 
their  own  population  seemed  inclined  to  look  elsewhere 
for  a  country  on  which  to  expend  their  energies.  The 
cloud  of  financial  depression  which  within  the  next 
year  or  two  made  itself  so  widely  felt  in  both  Europe 
and  America,  was  already  making  itself  felt  in  both 
Australia  and  New  Zealand,  and  there  were  not  want- 
ing many  who  pointed  to  the  heavy  public  indebtedness 
of  the  latter  as  a  reason  for  anticipating  something  like 
national  bankruptcy  as  the  probable  consequence  of  a 


170     SOCIAL  WELFARE  m  NEW  ZEALA:^D 

succession  of  bad  years.  There  was,  of  course,  no 
denying  the  fact  of  the  heavy  load  of  public  debt,  in- 
volving an  annual  liability  of  fully  twenty  dollars 
(nearly  four  pounds  four  shillings)  on  every  indi- 
vidual in  the  community;  and  though  the  greater  part 
of  this  was  represented  by  railroads  and  other  impor- 
tant public  utilities,  the  fact  that  these  things  had  been 
provided  in  advance  of  the  actual  needs  of  the  people 
left  a  margin  of  liability  that  had  to  be  met  out  of 
the  general  taxation  of  the  colony.  The  leaders  of 
public  opinion  in  the  country  were  fully  alive  to  the 
dangers  of  the  situation ;  the  question  was  in  what  way 
the  mistakes  of  their  predecessors  could  be  amended, 
so  that  the  colony  might  become  more  attractive  to  the 
best  class  of  settlers. 

The  policies  that  had  from  time  to  time  been  put 
forward  by  the  various  Cabinets  that  had  managed  the 
affairs  of  the  country  during  the  twenty  years  that 
preceded  1891  had  without  exception  been  framed  to 
meet  some  urgent  need  of  the  moment.  Some  of  them 
had  fairly  answered  their  purpose,  others,  like  that  of 
1872,  which  proposed  large  public  works  and  assisted 
immigration,  had,  after  a  good  many  years'  experience 
proved  itself  largely  a  failure.  ISTone  of  them  had 
taken  a  form  that  introduced  anything  like  a  continu- 
ous policy,  involving  a  new  principle  of  government. 
It  would  perhaps  be  an  exaggeration  to  say  that  the 
policy  definitely  begun  in  or  about  1891,  to  which  in 
this  book  we  have  assigned  the  name  of  State  Social- 
ism, was  begun  with  any  clear  idea  that  it  differed 
from  other  policies  or  was  more  likely  to  exercise  a 


NEW  ZEALAND  TWENTY  YEAES  AGO     lYl 

permanent  influence  on  the  legislation  and  social  con- 
ditions of  the  country  than  those  that  had  gone  before 
it.  As  a  matter  of  fact,  however,  it  did  so  —  each  stat- 
ute passed  appearing  to  necessitate  another  statute ; 
each  step  taken  to  compel  the  Community  and  its  rulers 
to  take  another  in  the  same  direction. 

The  experience  is  so  remarkable  that  it  naturally 
compels  an  investigation  of  results.  When  the  new 
policy  was  entered  upon  it  was  all  but  universally  con- 
demned by  those  who  were  looked  on  as  authorities 
in  such  matters  as  rash  to  the  verge  of  insanity.  As  it 
went  on  it  has  been  criticised  as  ignorant  and  even 
childish  in  its  disregard  of  accepted  ideas  and  prac- 
tices in  older  countries.  It  has,  nevertheless,  and 
strange  to  say,  gone  on  for  twenty  years,  satisfying 
its  own  people,  and  more  and  more  attracting  the  at- 
tention of  the  people  of  other  nations.  The  hostile 
criticisms  of  those  learned  in  the  doctrines  of  the  po- 
litical economists  have  not  grown  less  emphatic,  though 
perhaps  they  have  lost  a  little  of  their  tone  of  absolute 
superiority;  the  denunciations  of  those  who  believe  in 
the  divine  right  of  capital  to  control  modem  civilisa- 
tion and  use  it  for  its  own  aggrandisement  have  not 
become  less  fierce  since  it  appeared  that  in  one  coun- 
try at  least  the  assumed  privileges  of  capital  could  be 
so  long  refused  without  bringing  about  the  catastrophe 
looked  for  with  such  confidence.  It  may  even  be  said 
that  their  indignant  protests,  and  angry  denunciations 
have  had  the  effect  of  giving  a  prominence  to  the  young 
country  they  denounced,  and  awakening  an  interest 
in   the   experiments   that   were   so   unexpectedly   slow 


172     SOCIAL  WELFAEE  m  NEW  ZEALAND 

in  bringing  about  the  commercial  ruin  so  long  pre- 
dicted. The  question  lias  naturally  been  asked  witli 
increasing  interest,  as  one  outrageous  experiment  fol- 
lowed another  —  each  as  it  appeared  more  antagonistic 
to  the  reign  of  capital,  each  more  opposed  to  the  laws 
that  had  so  long  been  supposed  to  be,  in  principle  at 
least,  like  those  of  the  ancient  Medes  and  Persians  in 
the  one  respect  that  they  altered  not  —  When  is  the 
farce  going  to  end  ?  When  is  the  deception  that  has 
been  kept  up  for  so  many  years  to  be  exposed  ? 

The  object  with  which  this  book  is  written  being 
that  of  presenting  facts  and  not  impressions  relating 
to  New  Zealand,  the  writer  proposes  in  the  following 
chapters  to  deal  with  the  various  features  of  the  policy 
of  State  Socialism  as  developed  in  New  Zealand,  show- 
ing in  each  case  on  the  authority  of  the  Government 
statistics  laid  before  Parliament,  the  position  of  the 
country  and  its  people  twenty  years  ago  in  relation  to 
the  matters  dealt  with  for  reform  purposes,  and  their 
position  at  the  end  of  the  period.  The  objections  most 
persistently  made  to  the  policy  of  New  Zealand  have 
not  been  based  on  a  professed  dislike  to  its  objects. 
The  well-being  of  a  whole  people,  and  the  betterment  of 
the  conditions  of  that  part  of  it,  the  conditions  of 
which  were  least  satisfactory,  was  an  object  that  could 
hardly  be  criticised  directly,  indeed,  and  it  is  possible 
that  this  may  have  something  to  do  with  the  fact  that 
the  weight  of  criticism  has  been  laid  on  the  alleged  im- 
practicability of  any  such  attempt.  A  country  in 
which  the  large  accumulation  of  capital  in  a  few  hands 
is  discouraged  must,  it  has  been  argued  generally,  be 


NEW  ZEALAND  TWENTY  YEAES  AGO     173 

one  in  wliicli  the  enterprise  of  tlie  people  will  languish. 
A  country  in  which  so  much  is  done,  or  attempted,  for 
the  class  of  the  people  who  have  not  done  it  for  them- 
selves, must  —  so  it  has  been  said  with  apparent  con- 
viction,—  be  one  in  which  the  mass  of  the  people  will 
become  less  self-reliant  —  less  willing,  and  after  no  long 
period  less  capable,  of  helping  themselves.  This  would 
seem  to  be  a  practical  issue,  and  it  is  with  this  that 
we  propose  to  deal  in  the  chapters  that  follow.  In 
each  case,  therefore,  it  is  proposed  to  present  the  con- 
ditions of  New  Zealand  in  1891  in  relation  to  one  of 
the  reforms  referred  to  in  the  last  Book,  and  to  com- 
pare them,  on  the  authority  of  the  public  statistics, 
with  those  existing  in  1911.  It  may  be  said  by  those 
whose  preconceived  opinions  are  not  justified  by  the  re- 
sults, that  twenty  years  is  not  a  long  period  in  the  life 
of  a  nation,  and  that  further  experience  may  reverse 
the  verdict;  it  can  hardly  be  without  its  uses,  in  any 
case,  to  learn,  as  a  matter  of  fact  and  not  of  theory 
only,  what  the  experience  of  twenty  years  has  to  say  as 
to  the  possible  solution  of  a  problem  of  world-wide  sig- 
nificance. 


CHAPTEE  II 

THE  LAND  AND  THE  LAND  OWNEES 

It  is  a  curious  fact  that  of  all  the  colonies  founded 
by  England  New  Zealand  was  the  one  that  was  most 
of  all  intended  by  its  original  founders  to  reproduce 
the  social  and  economic  conditions  of  the  mother  coun- 
try, and  perhaps  chiefly  those  that  concerned  the  owner- 
ship of  the  land.  Times  had  so  far  changed,  indeed, 
and  some  ideals  of  fair-play  had  so  far  altered  that  the 
methods  of  the  Norman  Conquest  in  England,  and 
those  of  the  English  settlement  of  America  no  longer 
seemed  unquestionably  correct,  and  acquisition  by  pur- 
chase instead  of  violence,  was  accepted  as  the  best  policy 
for  securing  possession  of  the  country.  So  far,  how- 
ever, as  the  white  settlers  were  concerned,  that  was 
the  only  material  change  that  was  contemplated  by  the 
great  English  Company  that  really  began  the  settle- 
ment of  the  new  colony.  The  land  of  New  Zealand, 
indeed,  was  to  be  bought,  and  not  taken  from  its  na- 
tive owners;  and  when  it  had  been  bought  it  was  to 
be  sold  to  a  select  class,  representing  the  class  of  land 
owners  in  the  mother  country.  Special  efforts  were 
made  to  interest  the  land  owner,  or  gentry  class  of  Eng- 
land, and  to  induce  the  younger  sons  of  such  people  to 
take  part  in  founding  the  new  colony;  and  the  attempt 

174 


THE  LAND  AND  THE  LAND  OWNERS     175 

was  largely  successful.  Many  members  of  such  fami- 
lies took  advantage  of  the  opportunity  of  providing  in 
this  way  for  their  younger  sons,  and  a  beginning  of 
large  land  holdings  was  made  before  the  Colonial  Gov- 
ernment took  over  the  land  claims  of  the  original  "  New 
Zealand  Company."  The  change  of  management,  how- 
ever, made  but  little  difference  at  first  in  the  creation 
of  large  estates.  The  price  of  land,  it  is  true,  was 
fixed  at  a  uniform  rate  of  two  and  a  half  dollars  (ten 
shillings)  per  acre,  and  it  was  open  to  everybody  who 
had  the  money  to  buy  at  that  rate,  which  had  the  ef- 
fect of  putting  an  end  to  the  dream  of  raising  a  popu- 
lation of  tenant  farmers  in  the  colony ;  but  as  there  was 
no  limit  to  the  extent  of  land  purchases  the  practice  of 
buying  up  large  areas  of  land  went  on  unchecked  for 
a  good  many  years. 

Several  attempts  were  made  between  1878  and  1891 
to  discourage  the  holding  of  large  freehold  estates  by 
individuals  or  companies,  as  these  were  always  used  for 
grazing  purposes,  and  generally  stood  in  the  way  of 
more  profitable  farming  by  settlers  who  were  prepared 
to  occupy  and  cultivate  farms  of  reasonable  size.  The 
methods  adopted  at  first  were  various  forms  of  land 
taxation,  increasing  on  a  sliding  scale  in  proportion 
to  the  extent  of  the  holdings;  it  was  found,  however, 
after  some  years'  trial,  that  the  owners  of  the  great 
estates  could  secure  so  large  a  return  from  grazing  sheep 
on  the  natural  grass,  which  covered  the  greater  part 
of  the  south  island,  where  most  of  the  great  estates  lay, 
that  the  hoped-for  effect  of  obliging  the  owners  to  sell 
was   not   produced.     The   attempt  was   very   severely 


176     SOCIAL  WELPAUE  IN  NEW  ZEALAND 

criticised  in  England,  as  well  as  in  the  colony,  by  the 
representatives  of  capital,  as  both  foolish  and  unfair; 
the  principal  objection  taken  to  it  in  New  Zealand  it- 
self, however,  was  that  while  it  added  to  the  revenue 
it  did  not  answer  its  purpose  of  throwing  open  to 
real  settlement  large  areas  of  the  best  and  most  acces- 
sible land  of  the  country. 

The  practical  failure  of  the  policy  of  graduated  tax- 
ation led  to  the  adoption  of  the  system  which  has  been 
looked  on  as  the  first  of  New  Zealand's  actual  experi- 
ments in  State  Socialism  —  the  compulsory  sale  by 
the  owners  of  large  estates  to  the  Government  of  all 
the  freehold  land  held  by  them  over  and  above  such  an 
amount  as  could  reasonably  be  required  for  farming 
purposes  by  the  owner  surrounding  his  place  of  resi- 
dence. Neither  the  peoj^le  nor  the  Government  of  New 
Zealand  were  socialists  in  any  of  the  more  ordinary 
meanings  of  the  term;  they  were,  however,  cocfvinced 
that  their  country  was  one  that  was  eminently  fitted 
for  close  settlement,  and  equally  so  that  the  nation  as  a 
whole  had  the  right  to  rectify  any  mistakes  in  the  policy 
of  the  past,  where  it  could  be  done  without  injustice  in 
the  present.  The  policy  of  compulsory  land  sales  ha3 
been  called  confiscation  by  the  friends  of  capital;  the 
answer  made  by  New  Zealand  has  been  that  by  buy- 
ing land  needed  for  the  people  at  its  present  value  they 
confiscated  nothing,  except  the  selfish  expectation  of 
accumulating  riches  in  the  future  from  the  necessities 
of  the  public.  Such  a  confiscation  they  maintained 
was  both  allowable  and  right. 

Acting   on   this   conviction  they   have   taken   large 


THE  LAND  AND  THE  LAND  OWNEES     177 

estates  from  the  owners  by  compulsory  purchase  when- 
ever it  became  evident  that  there  was  a  demand  for 
the  land  by  a  sufficient  number  of  suitable  settlers,  who 
were  prepared  to  use  it  for  residence  and  actual  im- 
provement in  small  areas,  and  on  terms  that  would  se- 
cure the  community  from  any  loss  by  the  purchase. 
Up  to  this  time  nearly  eight  million  pounds,  or  about 
thirty-eight  million  dollars,  of  public  money,  borrowed 
by  the  nation,  has  been  spent  on  the  purchase  of  such 
estates.  They  have  also  withdrawn  large  areas  of  land 
purchased  by  the  Government  from  the  native  owners 
from  absolute  sale  in  freehold,  and  have  offered  it  for 
lease  to  the  public  under  a  variety  of  conditions  —  such 
as  perpetual  lease,  lease  in  perpetuity,  lease  for  ninety- 
nine  years,  and  lease  for  a  shorter  period  with  right 
of  renewal  to  the  holder  on  revaluation  —  but  in  all 
cases  with  the  condition  of  residence  and  improvement, 
and  the  further  condition  that  no  single  leaseholder 
should  be  a  crown  (or  national)  tenant  in  respect  of 
more  than  320  acres  of  the  public  land. 

At  the  beginning  of  the  year  1891  there  were  in 
New  Zealand  about  forty  thousand  separate  land  hold- 
ings, used  for  what  might  be  called  farming  purposes, 
and  including  anything  from  orchards  and  market  gar- 
dens of  five  acres  and  upwards  to  large  areas  used  for 
grazing  purposes  only,  but  containing  more  or  less  land 
that  had  been  improved  by  sufficient  cultivation  to  al- 
low of  the  substitution  of  European  grasses  for  the 
wild  pastures  native  to  the  country.  At  that  time 
there  were  about  two  million  and  a  half  acres  occu- 
pied by  small  holders  in  farms  of  less  than  two  hun- 


1T8     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

dred  acres  in  extent,  and  about  thirty-three  million 
acres  occupied  by  persons  holding  areas  of  more  than 
320  acres  each.  In  the  year  1891  there  were  about 
sixty-nine  thousand  persons  in  the  country  who  were 
actually  engaged  in  agricultural  work  of  some  kind; 
and  of  these  fully  sixty  thousand  were  at  work  either 
for  themselves  or  others  on  the  small  farms,  while 
nearly  nine  thousand  were  at  work  on  the  larger  es- 
tates. In  that  year  grain  and  other  crops  occupied 
about  one  million  three  hundred  thousand  acres  —  more 
than  half  the  area  of  the  smaller  farms  —  while,  with 
the  exception  of  a  little  hay,  no  considerable  quantity 
of  any  kind  of  crop  was  grown  on  the  larger  estates. 
The  population  of  New  Zealand  in  that  year  was  about 
630,000  persons  of  European  origin,  of  whom  more 
than  half  had  been  bom  in  the  country,  and  fully  sev- 
enty per  cent,  of  whom  were  of  the  male  sex.  No  ex- 
act record  of  the  ages  of  the  people  at  that  time  ex- 
ists, but  it  seems  nearly  certain  that  there  were  not 
more  than  a  hundred  and  thirty-five  to  a  hundred  and 
forty  thousand  male  persons  of  the  full  age  of  twenty- 
one  years  in  the  country.  Practically  one-half  of  the 
men  of  New  Zealand  were  therefore  at  that  time  em- 
ployed on  the  land,  either  as  farmers  or  hired  workers, 
and  the  total  value  of  the  agricultural  produce  of  the 
country  for  the  year  was  estimated  at  a  little  less  than 
four  million  pounds  sterling  (about  $18,000,000). 
To  this  must  be  added  the  increase  of  stock  of  various 
kinds,  particularly  sheep,  and  the  raw  products  in  wool, 
hides,  and  tallow,  the  total  value  of  which  was  more 


THE  LAND  AND  THE  LAND  OWNEKS     179 

than  equal  to  all  the  croi^s  of  the  year,  and  formed 
much  the  largest  part  of  the  exports  of  the  country. 

It  may  thus  be  said  that  at  the  beginning  of  1891 
half  the  workers  of  New  Zealand  were  engaged  in 
some  kind  of  agricultural  or  pastoral  work,  with  the 
result  that  the  produce  of  the  land  in  one  form  or  other 
was  worth  about  forty  million  dollars  (£8,500,000), 
and  the  exports  of  produce  of  this  kind  from  the  coun- 
try brought  in  a  return  of  nearly  six  million  dollars 
—  (£5,800,000).  The  extent  and  value  of  the  pro- 
duce of  the  land  was,  it  will  be  observed,  considerable, 
and  part  of  the  criticisms  levelled  at  New  Zealand's 
new  land  policy  took  the  form  of  jeers  at  the  young 
community  which,  not  content  with  a  reasonable  pros- 
perity, must  rush  into  new  experiments  in  the  vain 
hope  of  getting  rich  all  at  once. 

Twenty  years  have  passed.  There  has  been  no  revo- 
lution in  New  Zealand  during  the  period.  The  peo- 
ple of  the  country  would,  as  a  rule,  be  surprised  if 
they  were  told  that  there  had  been  any  great  or  radical 
reforms.  Nothing  has  been  taken  from  anybody  until 
it  seemed  to  be  urgently  needed  by  the  people ;  and 
when  the  land  was  taken,  it  has  been  paid  for  at  its 
fair  value,  and  those  who  received  the  payment  have, 
strange  as  it  may  appear,  almost  invariably  invested  it 
in  the  country.  The  land  which  was  thus  bought  back 
from  its  original  purchasers  had  constituted  a  little 
more  than  two  hundred  estates  of  various  sizes,  mak- 
ing on  the  whole  an  area  of  nearly  one  and  a  half  mil- 
lions of  acres.     It  had  cost  the  country  a  little  more 


180     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

than  thirty  million  dollars,  and  had  been  leased  to  resi- 
dent farmers  in  sections  of  from  a  hundred  and  fifty  to 
three  hundred  and  twenty  acres.  These  farmers  —  or 
selectors,  as  they  are  technically  called  —  numbered  at 
the  end  of  1910  rather  more  than  4,700,  in  number, 
and  with  their  families  numbered  nearly  seventeen 
thousand  persons.  The  rents  actually  received  from 
these  leaseholders  by  the  Government  had  been  suffi- 
cient to  pay  the  interest  of  the  debt  incurred  by  the 
public  for  the  purchase  of  the  land,  with  a  sinking  fund 
at  the  rate  of  one  per  cent,  per  annum  on  the  debt, 
and  to  leave  a  balance  to  the  credit  of  the  account  of 
fully  a  million  dollars.  So  far,  therefore,  as  the  orig- 
inal purpose  of  the  policy  of  compulsory  repurchase 
of  large  estates  is  concerned  it  is  clear  that  it  has 
proved  a  success.  Two  hundred  of  such  estates  have 
been  broken  up  into  fragments.  A  population  which 
certainly  did  not  exceed,  on  the  most  liberal  computa- 
tion, one  thousand  persons  of  all  ages  and  both  sexes, 
has  given  place  to  one  of  nearly  seventeen  thousand 
persons,  nearly  five  thousand  of  whom  are  farmers  of 
the  land  in  close  settlement. 

Under  the  terms  of  their  leases  the  selectors  were 
bound  not  only  to  live  on  but  to  improve  the  land 
leased  by  them.  Up  to  the  end  of  1910  the  improve- 
ments made  by  these  tenants  of  the  nation  were  valued 
by  impartial  assessors  at  fully  eleven  million  dollars. 
It  must  be  remembered,  however,  that  the  compulsory 
purchase  of  large  estates  was  not  the  only  experiment 
in  land  legislation  made  about  this  time  by  the  Parlia- 
ment of  New  Zealand.     Large  areas  of  the  best  lands 


I 


THE  LAKD  AND  THE  LA:N^D  OWNEKS     181 

bought  by  the  Government  from  the  natives  were  with- 
drawn from  the  market  as  freehold  lands,  and  were 
offered  for  selection  by  persons  prepared  to  settle  on 
them  as  leaseholders  for  long  terms  of  years  or  under 
a  perpetual  tenure.  The  terms  of  such  leases  dif- 
fered in  some  particulars  so  as  to  offer  special  attrac- 
tions to  different  classes  of  intending  settlers,  but  all 
were  alike  in  providing  for  an  annual  rental  equivalent 
to  four  per  cent,  on  the  present  value  of  the  land,  with 
a  revaluation  after  periods  of  twenty-one  years ;  all  de- 
manded residence  on  the  land  leased,  and  all  provided 
that  improvements  to  a  certain  value  in  proportion  to 
the  area  of  the  selection  must  be  made  within  the  first 
ten  years  of  the  tenancy.  The  extent  of  these  was  as 
in  the  case  of  the  other  leaseholds,  strictly  confined 
within  an  area  not  exceeding  three  hundred  and  twenty 
acres  to  each  person.  At  the  end  of  1910  the  total 
number  of  tenants  of  the  national  lands  was  more  than 
twenty-six  thousand  —  the  holders  of  Pastoral  leases 
on  land  still  uncultivated  and  used  only  for  grazing 
purposes  not  being  included  in  the  number  —  and  the 
area  of  land  held  under  these  farming  leases  was  a 
little  more  than  six  million  acres  in  all.  The  sums 
payable  in  annual  rentals  on  these  twenty-six  thousand 
leaseholds  was  nearly  four  hundred  and  ninety  thousand 
pounds  (about  $2,450,000)  in  each  year. 

The  population  of  the  country,  which  twenty  years 
before  had  been  about  634,000,  had  risen  at  the  end 
of  1910  to  as  nearly  as  possible  one  million  persons  of 
European  race,  and  of  these  fully  125,000  were  em- 
ployed on  the  country  lands  —  an  increase  in  twenty 


182     SOCIAL  WELEAEE  IN  NEW  ZEALAND 

years  of  nearly  one-lialf,  or  more  than  sixty  thousand 
persons.  In  IS 90  the  lands  of  New  Zealand  had  been 
divided  into  about  forty-one  thousand  farms;  at  the 
end  of  1910  there  were  more  than  eighty  thousand 
farms  under  cultivation  in  the  country.  It  appears, 
therefore,  that  a  second  object  kept  in  view  by  the 
originators  of  a  general  system  of  encouraging  the  oc- 
cupation of  the  land  under  a  leasehold  tenure,  return- 
ing an  annual  income  to  the  nation,  and  enabling  the 
nation  to  insist  on  such  conditions  as  occupation,  im- 
provement, and  close  settlement  on  farms  of  moderate 
size,  had  also  been  realised  —  that,  namely,  of  inducing 
a  larger  proportion  of  the  entire  population  to  live  on 
the  land  and  engage  in  agricultural  pursuits. 

It  is,  of  course,  open  to  argument  that  the  doubling 
of  the  number  of  farms  in  a  country  does  not  necessarily 
increase  the  wealth  of  its  people.  It  is  quite  possible 
to  believe  and  to  maintain  that  a  country  may  be  far 
more  prosperous  when  its  land  is  for  the  most  part  in 
the  hands  of  a  small  body  of  capitalists,  who  have  at 
their  command  ample  capital  with  which  to  make  the 
best  of  it.  It  may  be  pointed  out  that  while  large 
holdings  of  land  were  encouraged  by  the  laws,  and  an 
enormous  proportion  of  the  best  land  was  owned  by 
a  few  people  or  companies,  very  great  progress  was 
made  in  the  development  of  the  pastoral  industries  — 
so  much  so,  indeed,  that  in  the  previous  twenty  years 
between  five  and  six  million  acres  had  been  cultivated 
sufficiently  to  enable  European  grasses  to  be  substituted 
for  the  coarse  native  pasture.  It  is  unquestionably 
true  that  this  had  been  done  on  a  large  scale  by  the 


THE  LAND  AND  THE  LAND  OWNERS     183 

capital  of  a  small  class  of  the  people,  and  that  it  had 
the  effect  of  very  greatly  increasing  the  value  of  the 
country's  exports;  it  had  not,  however,  materially  in- 
creased the  wealth  (or  well-being)  of  the  great  major- 
ity of  the  people,  as  much  —  probably  most  —  of  it 
went  to  persons  or  companies  in  England.  No  coun- 
try is  rich,  in  any  true  sense,  unless  the  masses  of  its 
people  are  rich  in  all  that  constitutes  well-being,  and 
it  was  this  which  the  progress  of  New  Zealand,  as  a 
happy  hunting  ground  for  the  great  pastoral  holders, 
had  failed  to  accomplish. 

The  new  —  or  so-called  anti-capitalist  land  policy 
—  had  been  intended  to  provide  for  this,  and  in  the 
twenty  years  it  had  been  largely  successful  in  doing 
so.  The  people  had  not  only  gone  back  to  the  land  in 
a  markedly  increased  proportion,  during  the  period, 
but  they  had  materially  increased,  not  only  their  own 
wealth  but  that  of  the  countiy  by  doing  so.  The 
purely  pastoral  areas  of  the  coimtry  had  not  greatly 
increased  during  the  twenty  years,  but  even  the  pas- 
toral produce  of  the  country  had  greatly  increased  in 
value,  while  the  general  contribution  made  by  the  land 
to  the  wealth  of  the  community  had  increased  to  a  re- 
markable extent.  In  1890  the  value  of  the  pastoral 
and  agricultural  produce  of  New  Zealand  amounted 
to  as  nearly  as  possible  $30,000,000  (£6,200,000). 
This  was  about  forty-five  dollars  per  head  of  the  whole 
population.  In  1910  the  European  population  of  New 
Zealand  had  increased  to  about  a  million  persons  of 
all  ages,  and  in  that  year  the  value  of  the  agricultural 
and  pastoral  produce  of  the  country  had  increased  to 


184     SOCIAL  WELFARE  IN  NEW  ZEALAND 

more  than  $74,000,000  (£14,900,000)  in  addition  to 
all  the  food  that  was  required  for  the  consumption  of 
the  people  themselves.  That  is  to  say,  that  while  the 
people  had  increased  in  numbers  one-third,  the  increase 
of  production  from  the  lands  of  the  country  had  been 
60  great  that  instead  of  forty-five  dollars'  worth  of 
produce  exported  for  every  inhabitant  there  was  actu- 
ally seventy-four  dollars'  worth. 

New  Zealand  then,  under  the  old  way  of  dealing 
with  its  land,  by  letting  it  fall  into  the  hands  of  capi- 
talists, had  been  productive  to  a  moderate  extent, 
though  most  of  the  profit  had  gone  to  the  capitalists, 
and  comparatively  little  to  the  great  majority  of  the 
people:  under  the  new  and  heretical  system  it  had,  as 
far  as  the  productiveness  of  the  land  was  concerned, 
become  very  much  more  successful,  and  a  much  larger 
proportion  of  the  wealth  had  gone  into  the  hands  of 
the  people  generally.  This  may  appear  to  be  a  bold 
claim  to  make,  but  even  this  is  not  the  full  extent  of 
what  may  with  justice  be  claimed  as  the  result  of 
twenty  years  of  economic  heresy  as  applied  to  the  man- 
agement of  the  land  of  a  country.  It  is  not  only  an- 
nual income  from  the  land  that  has  increased  —  the 
capital  value  has  increased  also.  When  the  policy  was 
adopted  the  people  of  New  Zealand  were  threatened 
with  the  withdrawal  of  capital  from  the  country,  and 
the  decay  of  the  enterprise  which  had  made  it  unu- 
sually successful  in  all  respects  in  which  success  was 
possible  for  a  countr)^  so  young  and  so  remote ;  twenty 
years  have  now  elapsed  and  the  capital  embarked  in 
agricultural  and  pastoral  pursuits  to-day  is  very  much 


THE  LAND  AND  THE  LAND  OWNERS     185 

greater  than  it  was  then,  and  now  the  increased  capital 
belongs,  for  the  most  part,  to  the  workers  on  the  land. 
In  1890  there  were  fully  820,000  cattle,  210,000 
horses,  and  300,000  pigs,  as  well  as  nearly  18,000,- 
000  sheep  in  New  Zealand;  representing  undoubtedly 
a  large  amount  of  capital  invested  in  live  stock.  In 
1910  the  number  of  horses  in  the  country  had  in- 
creased to  upwards  of  370,000,  and  the  number  of  cat- 
tle to  more  than  1,800,000  —  more  than  two  for  every 
one  in  the  country  twenty  years  before.  There  were 
fully  24,000,000  sheep  instead  of  eighteen  millions, 
and  only  the  stock  of  pigs  had  fallen  off  in  numbers: 
the  pigs  were  fewer  by  nearly  fifty  thousand  than  they 
had  been  twenty  years  before.  It  would  manifestly  be 
difficult  to  estimate  the  precise  increase  of  capital  value 
of  live  stock  during  the  twenty  years,  but  as  it  is  well 
known  that  great  progress  has  been  made  during  the 
period  in  the  improvement  of  the  quality  of  every  kind 
of  stock,  except,  perhaps  pigs,  it  is  safe  to  say  that  the 
capital  represented  by  the  farming  and  pastoral  stock 
of  New  Zealand  is  very  little  less  than  twenty-five  per 
cent,  greater  than  it  was  twenty  years  ago ;  and  very 
much  the  greater  part  of  this  increase  is  represented 
by  horses  and  dairy  cattle,  the  two  classes  of  animals 
that  are  almost  entirely  confined  to  the  farms  that  rep- 
resent the  system  of  closer  settlement. 


CHAPTER  III 

LAW-ABIDING    INDUSTRY 

The  wealth  of  a  nation  can  only  be  reached  in  any 
true  sense  of  the  words  by  the  co-operation  of  all  parts 
of  the  community.  This  has  been  the  conclusion  of 
the  people  of  New  Zealand,  and  it  is  one  that  appears 
to  be  fully  justified  by  considerations  of  common- 
sense,  and  not  less  by  the  test  of  experience.  Even  if 
wealth  really  meant  only  that  which  political  economists 
have  persuaded  themselves  to  believe  and  to  teach  — 
the  possession  by  a  small  class  of  a  nation  of  riches, 
more  or  less  in  excess  of  reasonable  requirements  — 
this  would  be  true.  In  any  broader,  and  truer  mean- 
ing of  the  term  its  truth  becomes  still  more  apparent 
and  undeniable.  Well-being  —  the  well-being  of  a 
whole  people  at  least  —  is  only  possible  as  the  result  of 
the  co-operation  of  all  classes  of  the  nation. 

In  New  Zealand,  certainly  as  much  as  in  any  other 
country,  the  need  of  more  just  and  fair  conditions  in 
the  dealings  between  different  sections  of  society,  and 
especially  between  the  employers  and  the  employed, 
had  been  widely  recognised  more  than  twenty  years 
ago.  For  many  reasons,  indeed,  the  varieties  of  in- 
dustrial pursuits  followed  by  the  people  were  compara- 
tively few,  and  for  some  years  most  of  them  had  made 

186 


LAW-ABIDING  INDUSTRY  187 

little  or  no  perceptible  growth.  The  industries  con- 
nected with  the  land  were,  of  course,  the  chief  ones, 
and  for  the  most  part  they  were  carried  on  mainly  by 
individuals  and  their  families,  with  but  little  help 
from  hired  labour.  Under  the  circumstances,  it  must 
be  admitted  the  problems  of  labour  existed  on  a  very 
small  scale  in  New  Zealand  at  the  time  when  legisla- 
tive action  was  first  taken  to  deal  with  them,  and  this, 
it  is  needless  to  say,  may  have  had  much  to  do  with  the 
success  which  attended  the  experiments  made. 

The  view  taken  of  the  question  by  the  Parliament 
when  it  first  came  before  it,  however,  was  one  which 
in  principle  was  in  no  way  affected  by  the  number  of 
trades  practised  in  the  country,  or  the  number  of  work- 
ers employed.  The  question  was,  in  fact,  how  could 
justice  best  be  secured  for  workers  and  employers  alike, 
with  due  regard  to  the  well-being  at  the  same  time  of 
the  whole  community  ?  The  view  taken  by  the  New 
Zealand  Parliament  was  that  only  by  the  operation  of 
some  just  law  could  fair-dealing  be  assured  in  cases 
where  personal  interests  must  at  all  times  be  keenly 
felt;  and  that  only  by  the  stem  enforcement  of  such 
a  law  could  society  hope  to  escape  the  evils  of  what 
would  practically  become  a  species  of  civil  war.  It 
was  decided  to  introduce  a  system  that  might  gi'adually 
commend  itself  for  general  acceptance,  and  when  it 
was  accepted,  to  enforce  its  provisions  as  rigidly  as 
those  of  any  other  law  on  the  statute  book  of  tlie  coun- 
try. The  law  took  the  form  of  the  Arbitration  statute 
of  New  Zealand ;  and  like  all  other  laws  its  success  has 
depended  on  the  co-operation  of  the  people. 


188      SOCIAL  WELFARE  m  NEW  ZEALAND 

When  the  experiment  —  for  in  its  very  form  it  was 
franJ\ly  experimental  —  was  first  made  in  1894  it  was 
subject  to  many  objections  by  critics  —  it  was  con- 
demned as  impracticable  on  the  ground  that  neither 
workers  nor  employers  would  accept  it,  which  was  the 
preliminary  step  to  its  operation;  it  was  condemned 
also  on  the  further  ground  that  its  operation  would  of 
necessity  be  to  ruin  what  little  trade  there  was  already 
in  the  country,  and  to  cause  the  speedy  withdrawal 
from  New  Zealand  of  all  the  capital  that  had  been 
embarked  in  organised  industry.  This  opinion  was  so 
universally  entertained,  and  so  freely  expressed  both 
in  England  and  Australia  that  it  was  a  matter  of  al- 
most imiversal  astonishment  when  it  was  found,  after 
a  year  or  two,  that  the  new  law  was  being  accepted  in 
the  country  of  its  origin,  by  the  workers  at  any  rate, 
as  something  that  might  prove  a  real  advantage  to  them. 
The  first  ground  of  condemnation  having  thus  proved 
itself  mistaken  it  was  only  natural  that  the  second 
should  be  paraded  as  deserved  beyond  question.  Capi- 
tal, it  was  said,  would  quickly  be  withdrawn,  and  in- 
dustrial occupations  of  any  skilled  and  important 
character  were  on  the  eve  of  departure  from  the  coun- 
try. Had  these  anticipations  proved  correct  it  would 
have  been  a  serious  thing  for  New  Zealand;  fortu- 
nately they  have  proved  to  be  as  entirely  mistaken  as 
the  other  pessimistic  forebodings  relating  to  the  land 
legislation  of  the  country. 

New  Zealand,  of  course,  had  never  been  a  country 
in  which  much  manufacturing  was  carried  on.  Eor 
a  good  many  years  after  colonisation  was  begun  there 


LAW-ABIDING  INDUSTRY  189 

was  practically  nothing  of  the  kind,  except  what  could 
be  done  in  a  carpenter's  shop  or  at  a  blacksmith's  forge. 
Of  course  a  few  other  industries  soon  grew  up  on  a 
very  small  scale,  but  for  the  first  thirty  years  of  the 
colony's  existence  it  could  hardly  be  said  that  anything 
like  a  mill  or  a  factory  of  any  kind  had  been  estab- 
lished. With  the  wave  of  new  immigration  that  set 
in  about  1872  a  certain  amount  of  attention  was  drawn 
to  the  country,  and  capitalists  began  to  inquire  whether 
the  young  colony  might  not  offer  a  field  for  some  few 
special  industries  of  an  organised  kind  that  might 
make  a  good  return.  The  consequence  was  that  after 
a  time  companies  established  woollen  mills,  clothing 
and  shoe-making  factories,  iron  foundries,  tanneries, 
grain  mills,  and  biscuit  factories,  as  well  as  others  of 
less  importance.  There  were  more  than  25,000  work- 
men employed  in  these  factories  in  the  colony  in  1890, 
and  these  with  their  families,  probably  represented  a 
fifth  part  of  the  whole  population.  By  the  census  of 
1891  it  appeared  that  the  wages  paid  to  these  workers 
in  the  previous  year  had  amounted  to  rather  more  than 
five  million  dollars  (£1,160,000),  or  about  two  hun- 
dred dollars  (£40)  on  an  average  to  each  worker. 

The  threat  so  generally  made  when  the  Labour  leg- 
islation of  New  Zealand  was  begim  was  serious  enough 
to  cause  a  good  deal  of  uneasiness.  Five  million  dol- 
lars in  wages  does  not  perhaps  seem  a  great  deal,  but 
to  a  country  as  young  as  the  colony  then  was  it  was 
of  great  importance  apart  from  the  prospects  of  in- 
crease in  which  the  colonists  had  indulged.  The 
steady,   almost   dogged   temper   of  the   race,   however, 


190     SOCIAL  WELFARE  IK  :N"EW  ZEALAND 

prevented  the  people,  or  tlieir  representatives  from  hesi- 
tating, and  as  events  have  proved  they  were  right  in 
doing  so.  The  capital  embarked  in  manufacturing  in- 
dustries was  not  withdrawn  from  the  country.  For 
a  year  or  two,  indeed,  it  seemed  to  hesitate,  and  did 
not  greatly  increase ;  after  that  it  appeared  to  regain  a 
confidence  greater  than  before,  which  in  the  last  fif- 
teen years  has  suffered  no  relapse. 

In  1890  there  were  nearly  1,300  factories,  mills, 
and  work  places  for  associated  labour  in  manufactur- 
ing goods  in  New  Zealand,  and  in  these  there  had  been 
invested,  for  land,  buildings,  and  machinery,  nearly 
a  million  and  a  quarter  pounds  sterling — ($6,000,- 
000).  At  the  end  of  twenty  years  of  labour  legislation 
■ —  including  shorter  hours,  fewer  days  of  work,  higher 
wages,  and  greater  privileges  to  the  workers  than  were 
to  be  had  in  any  other  country  in  the  world  —  the  capi- 
tal invested  in  the  land,  buildings,  and  machinery  of 
mills,  factories,  and  other  industrial  works  had  in- 
creased to  upwards  of  eighty-five  million  dollars  — 
(£17,500,000).  In  other  words,  the  confidence  of  capi- 
tal in  the  stability  of  the  industry  of  the  country  had 
so  far  increased  that  there  was  as  nearly  as  possible 
three  times  as  much  capital  invested  in  factories  as 
there  had  been  twenty  years  before,  when  the  relations 
of  workers  and  employers  were  the  same  in  New  Zea- 
land as  in  such,  other  countries  as  America  and  Great 
Britain. 

In  1890  the  number  of  hands  employed  in  manu- 
facturing establishments  was  fully  twenty-five  thousand 
men,  and  two  thousand  five  hundred  women  working 


LAW-ABIDI^^G  nq-DUSTRY  191 

in  about  one  thousand  three  hundred  mills  and  fac- 
tories, and  receiving  as  wages  about  five  and  a  half 
million  dollars  in  the  year.  In  1910  the  number  of 
hands  employed  amounted  to  nearly  seventy  thousand 
—  an  increase  of  forty  thousand  persons  employed. 
The  wages  paid  in  that  year  to  these  workers  amounted 
to  a  sum  of  fully  twenty-six  million  dollars  —  (£5,- 
450,000).  In  the  meantime  the  number  of  factories 
had  increased  to  upwards  of  five  thousand.  It  is  prob- 
able, however,  that  this  apparently  great  increase  in 
number  is  by  no  means  so  large  as  it  appears,  owing 
to  the  fact  that  the  law  has  declared  that  with  a  view 
to  inspection  and  control,  all  industrial  establishments 
employing  more  than  three  persons  as  workers  shall  be 
treated  as  factories  throughout  the  Dominion.  In 
spite  of  this,  however,  there  appears  to  be  no  doubt 
that  the  number  of  factories  —  places  set  apart  for 
manufacturing  labour  operated  by  paid  employes  — 
has  increased  more  than  threefold  during  the  last 
twenty  years. 

It  is  to  be  borne  in  mind  that  during  this  period 
of  twenty  years  the  population  of  the  country  has  in- 
creased almost  exactly  one-third.  The  point  of  real 
importance  is  to  observe  that  while  the  population  has 
advanced  in  numbers  one-third,  the  number  of  indus- 
trial establishments  for  the  manufacture  of  goods  has 
increased  threefold,  and  the  nmnber  of  workers  has 
been  considerably  more  than  doubled  within  a  period 
of  only  twenty  years,  under  conditions  that  were  sup- 
posed to  be,  and  no  doubt  were,  from  the  point  of  view 
of  the  orthodox  believers  in  the  doctrines  of  the  popu- 


192      SOCIAL  WELFAEE  IN  NEW  ZEALAND 

lar  school  of  political  economists  of  to-daj,  utterly  in- 
consistent with  success  and  progress.  There  should 
have  been  the  rapid  withdrawal  of  capital  from  the 
country,  and  especially  from  the  country's  industries, 
during  the  period;  there  has  been  instead  a  steady 
and  even  rapid  increase  in  the  capital  invested  in  the 
country  and  its  industries.  There  was  to  have  been 
a  decay,  if  not  a  total  stagnation  in  the  enterprise  of 
the  people ;  instead  of  which  they  have  apparently  been 
striking  out  year  after  year  into  new  lines  of  industry, 
and  an  increasing  proportion  of  the  people  have  been 
devoting  their  energies  to  hitherto  untried  employments 
calling  for  enterprise  and  skill. 

All  this,  it  is  also  important  to  notice,  has  been  ac- 
complished without  involving  any  change  that  has  im- 
perilled the  well-being  of  the  people.  In  other  coun- 
tries, when  manufactures  increased  the  change  has,  it 
is  not  too  much  to  say  invariably,  been  accompanied, 
or  at  least  quickly  followed,  by  lower  wages,  longer 
hours  of  labour,  and  worse  conditions  both  of  working 
and  living  for  the  mass  of  the  workers.  In  New  Zea- 
land this  has  not  been  the  case.  There,  on  the  con- 
trary, wages  in  every  branch  of  industry  have  been 
steadily  increased,  till  the  average  is  now  very  nearly 
double  what  it  was  twenty  years  ago;  the  hours,  and 
even  the  days,  of  labour  in  the  country  have  been  de- 
creased by  law  —  a  law  which  is  sternly  enforced,  so 
that  a  breach  is  hardly  ever  reported;  and  the  condi- 
tions of  the  workers,  both  during  work  hours  and  at 
other  times,  have  been  steadily  and  remarkably  im- 
proved.    There  is  absolutely  no  infant  labour  in  any 


LAW-ABIDING  INDUSTEY  193 

factory  in  New  Zealand;  there  are  no  male  workers  in 
anj  workshop  or  factory  less  than  sixteen  years  of  age, 
and  no  female  worker  less  than  eighteen  years  old.  In 
this  way  the  nation  has  provided  for  the  health  and 
physical  well-being  of  its  younger  generation;  and 
strangely  enough  in  doing  so  it  does  not  appear  to  have 
diminished  the  productive  power  of  the  community. 

It  is  important  to  observe  that  during  these  twenty 
years  the  industries  —  especially  those  involving  the 
employment  of  a  number  of  hands  concentrated  in  one 
place  —  had  been  regulated  by  law  to  a  degree  that 
was  quite  unknown  in  any  other  part  of  the  world. 
The  hours  and  days  of  labour  were  prescribed  by  the 
law,  and  could  not  be  exceeded,  even  by  mutual  con- 
sent, except  to  a  very  limited  extent,  and  then  only  on 
the  condition  of  greatly  increased  wages.  The  ages  at 
which  persons  could  be  employed  in  such  places,  and 
the  conditions  under  which  they  could  be  allowed  to 
work,  were  definitely  fixed,  and  constant  inspection 
was  provided  to  enforce  the  law.  Parents  could  not 
send  their  sons  and  daughters  into  mills  and  factories 
under  the  prescribed  age  for  the  sake  of  making  money, 
without  punishment ;  employers  of  labour  could  not  em- 
ploy workers  imder  the  statutory  age,  except  at  a  risk 
too  great  to  make  it  worth  while.  Employers  of  la- 
bour could  not  dismiss  those  whom  they  had  employed 
without  good  cause,  such  as  would  convince  a  Magis- 
trate in  open  court  of  the  justice  of  the  dismissal;  and 
under  no  circumstances  could  they  close  their  doors 
and  shut  out  their  workmen  because  of  any  difference 
between  tliem  as  to  any  matter  connected  with  their 


194     SOCIAL  WELFARE  m  NEW  ZEALAE^D 

employment.  On  tlie  other  band,  the  workers  could 
not  leave  off  work  in  a  body  on  account  of  any  differ- 
ence between  them  and  their  employers,  with  a  view 
to  compelling  them  to  agree  to  their  terms.  In  all  such 
cases  the  law  was  definite,  and  the  law  insisted  on  be- 
ing regarded  as  supreme.  Conciliators  had  been  pro- 
vided to  bring  about  agreements  between  employers 
and  employes,  and  in  case  of  their  failure  a  Court 
had  been  provided  before  which  the  question  could  be 
speedily  tried,  and  absolutely  settled.  In  every  case 
the  law  of  the  land,  and  not  the  interests  of  the  em- 
ployers, any  more  than  those  of  the  workers,  were  ap- 
pealed to,  because  the  law  was  framed  not  only  to  do 
justice  between  the  parties  themselves,  but  to  protect 
the  great  majority  of  the  nation,  who  had  no  interest 
in  the  matter  except  to  see  fair-play  between  the  par- 
ties, but  every  interest  in  seeing  that  nothing  like  in- 
dustrial war  arose  in  the  country  to  interfere  with  the 
well-being  of  the  people  at  large. 

Whatever  success  New  Zealand  has  had  during  the 
last  twenty  years  she  has  had  under  these  conditions. 
The  impossibility  of  such  success  had  been  confidently 
predicted,  but  so  far  as  the  steady  increase  of  manu- 
facturing enterprise  is  concerned,  the  prediction,  as  we 
have  already  seen,  has  been  entirely  falsified.  No 
country  in  all  the  world  has  made  so  great  an  advance 
in  its  manufacturing  development  in  proportion  either 
to  its  population,  or  to  the  extent  of  its  previous  devel- 
opment, during  that  period.  Her  organised  industries 
have  increased  in  number  during  the  twenty  years  by 
fully  three  hundred  per  cent. ;  the  capital  invested  in 


LAW-ABIDING  INDUSTRY  195 

them  lias  increased  by  a  still  greater  amount ;  the  num- 
ber of  workers  employed  by  nearly  two  hundred  and 
fifty  per  cent.,  and  the  wages  paid  to  the  workers  by 
nearly  two  hundred  per  cent.  It  can  hardly  be  ques- 
tioned that  these  figures  indicate  a  very  extraordinary 
progress  within  so  short  a  time.  It  may  be  asked,  how- 
ever, what  the  commercial  results  of  this  apparent 
energy  have  been.  It  may  be  suggested  that  all  this 
development  may  be  more  apparent  than  real,  and  that 
this  employment  of  an  army  of  idle  workers,  who  work 
short  hours  and  few  days,  and  yet  receive  better 
wages  than  men  and  women  in  other  countries  are  paid 
for  full  time  and  hard  work,  must  in  the  very  nature 
of  things  be  artificial,  and  must  shortly  prove  itself  a 
failure. 

The  concentrated  experience  of  our  ancestors  on 
such  questions  has  been  expressed  in  proverbial  form 
in  the  saying  that  "  the  proof  of  the  pudding  lies  in 
the  eating,"  and  it  is  only  fair  to  produce  this  proof 
in  reply  to  such  a  challenge  as  that  suggested.  In  the 
year  1891  the  value  of  the  materials  used  in  the  manu- 
facture of  goods  was  never  exactly  obtained,  as  manu- 
facturers were  not  asked  to  make  such  a  return;  in 
that  year,  however,  the  value  in  the  market  of  the 
goods  manufactured  in  the  previous  year  was  returned 
at  a  sum  of  £9,422,000  (16,000,000).  In  that  year 
the  value  of  manufactured  goods  in  excess  of  the  con- 
sumption of  the  people  of  the  colony  itself  was  about 
£550,000  (or  $2,700,000).  In  the  year  1910  the 
value  of  the  materials  used  in  manufactures  was  about 
eighty    million    dollars— (£16,300,000) — while    the 


196      SOCIAL  WELFiVEE  IN  NEW  ZEALAND 

value  of  the  manufactured  products  in  the  market  was 
considerably  in  excess  of  a  hundred  and  fifty  million 
dollars —  (£31,000,000).  A  very  large  proportion  of 
the  industries  of  the  country  were,  as  might  have  been 
expected,  closely  connected  with  the  immediate  needs 
of  the  people  themselves,  but  a  few,  and  these  the 
most  important  in  the  number  of  hands  employed,  and 
the  actual  value  of  the  products  in  the  market,  were 
mainly  connected  with  the  goods  exported  from  the 
country.  Taking  the  proportion  of  value  in  the  ma- 
terials used  to  the  final  products  of  manufacturing  in- 
dustry to  have  been  practically  the  same  in  1891  and 
1910,  however,  it  would  appear  that  the  increase  in 
the  value  attaching  to  the  manufacturing  energies  of 
the  country  amounted  to  about  three  hundred  and  fifty 
per  cent. —  an  increase  which,  it  is  needless  to  say,. has 
been  approached  by  no  other  country  within  the  period. 
Higher  wages,  regulated  by  a  Court  of  arbitration, 
proceeding  on  the  basis  of  evidence  produced  publicly, 
and  therefore  open  to  public  criticism,  has  not,  as  a 
matter  of  fact,  caused  the  withdrawal  of  capital  from 
old  industries,  or  the  paralysis  of  enterprise  in  estab- 
lishing new  ones.  Shorter  hours  of  labour,  and  more 
leisure  time  for  the  workers,  have  not  apparently  cur- 
tailed the  amount  of  work  done  by  them,  as  it  has  cer- 
tainly not  reduced  the  value  of  the  work  done  per  head 
by  the  workers  employed.  The  protection  of  the 
young  from  the  evil  effects  of  being  shut  up  too  early 
in  mills  and  factories,  and  the  constant  and  vigilant 
inspection  of  such  places  for  the  benefit  of  the  actual 
workers,  has  not,  it  would  seem,  interfered  either  with 


LAW-ABIDING  INDUSTRY  197 

the  establishment  and  extension  of  mills,  factories,  or 
workshops,  or  with  the  profits  that  can  legitimately  be 
obtained  from  them.  Such,  at  any  rate,  would  seem  to 
be  the  verdict  of  New  Zealand's  twenty  years'  experi- 
ence, and  it  is  a  verdict  which,  in  the  face  of  the  prac- 
tices and  theories  of  other  countries,  certainly  demands 
an  explanation.  It  is  easy,  of  course,  to  say  that  it 
cannot  last;  the  question  to  be  answered  by  those  who 
are  so  sure  of  this  is,  in  the  first  place  —  Why  has  it 
lasted  so  long;  and  if  so,  why  should  it  come  to  an 
end? 


CHAPTER  IV 

THE    OWNEESHIP    OF   PUBLIC    UTILITIES 

The  system  of  State  Socialism,  which  practically 
exists  in  Xew  Zealand,  involves  the  control  of  many 
things  that  are  not  as  yet  subject  to  control,  or  even 
interference,  by  Governments  in  other  civilised  coun- 
tries. Of  these,  and  of  the  apparent  results  of  such 
control  as  has  been  exercised  in  New  Zealand  during 
the  last  twenty  years,  we  shall  have  occasion  to  say 
something  in  the  next  chapter :  there  are,  however,  sev- 
eral important  Public  Utilities  that  have  been  estab- 
lished and  operated  in  that  country  for  a  good  many 
years,  the  control  of  which  has  become  more  or  less 
familiar  in  some  European  countries,  though  as  yet  it 
has  not  been  attempted  in  America.  These  Public 
Utilities  may  be  classed  under  the  general  head  of 
Communication,  and  include  railroads,  telegraphs,  and 
telephone  services,  and  the  extended  service  of  the 
Post  Office  as  a  means  of  carrying  lighter  classes  of 
goods  by  mail.  Three  at  least  of  the  four  have  been 
adopted,  and  are  to-day  in  more  or  less  complete  opera- 
tion in  several  European  countries,  though  no  Euro- 
pean nation  has  as  yet  adopted  them  all.  In  JSTew 
Zealand,  however,  they  have  all  been  in  operation  for 
a  good  many  years:  long  enough  to  enable  an  intelli- 

198 


OWNEESHIP  OF  PUBLIC  UTILITIES     199 

gent  opinion  to  be  arrived  at  as  to  how  far  their  public 
operation  on  behalf  of  the  people,  under  the  manage- 
ment of  the  people's  Government,  has  been  a  success. 

The  oldest  of  these  Utilities,  and  the  one  that  has 
been  most  widely  brought  under  Government  control 
in  the  countries  of  Europe,  has  been  the  railroads,  and 
it  must  be  admitted  that  the  impressions  of  travellers 
in  various  European  countries  in  which  the  railroads 
are  controlled  by  Government  officials  has  not  generally 
been  very  favourable,  as  compared  with  their  experi- 
ences in  America  or  England,  where  private  enterprise 
has  been  allowed,  until  lately,  at  any  rate,  an  almost 
free  hand.  In  the  case  of  most  of  the  countries  of 
Europe  in  which  the  railroads  have  been  subject  to  Gov- 
ernment control  there  is  much  that  is  unfamiliar  to 
the  ideas  of  either  Americans  or  Englishmen  as  to 
what  constitutes  freedom  of  action,  and  it  may  be 
added  few,  if  any  of  them,  appear  to  have  the  same 
natural  aptitude  for  the  management  or  operation  of 
railroads  as  successfully  as  people  of  our  own  race. 

It  was  not  till  the  year  1876  that  the  Government 
of  'New  Zealand,  as  a  whole,  became  the  controlling 
power  in  railroad  building  and  management.  'Before 
that  time  the  Provinces  (practically  States)  had  in  one 
or  two  cases  made  a  beginning  of  railroad  construction, 
but  the  lines  were  in  each  case  short,  and  of  no  great 
importance.  When  the  Colonial  Government  and  Par- 
liament succeeded  to  the  task  it  was  with  a  definite 
policy  of  borrowing  large  sums  of  money,  and  under- 
taking an  extension  of  the  railroads  to  open  up  the 
country  for  settlement.     The  new  policy  was  probably 


200     SOCIAL  WELFARE  IN"  NEW  ZEALAND 

somewhat  in  advance  of  the  needs,  as  well  as  of  the 
means  of  the  country  at  the  time ;  and  as  a  consequence 
the  revenue  from  the  traffic  was  not  sufficient  to  pay 
the  interest  on  the  loans  as  well  as  the  working  ex- 
penses of  the  lines.  Possibly  an  increase  of  the  rates 
for  passenger  and  goods  traffic  might  have  equalised 
matters,  but  it  was  considered  better  to  make  up  the  de- 
ficiency in  other  ways  rather  than  to  impose  burdens 
on  the  settlers  that  might  interfere  with  their  success, 
and  was  almost  certain  to  discourage  settlement  on  the 
land. 

One  of  the  most  generally  accepted  theories  ad- 
vanced by  those  who  oppose  the  idea  of  the  successful 
ownership  of  the  railroads  of  a  country  by  the  Gov- 
ernment is  the  idea  that  under  a  system  of  State  con- 
struction and  public  ownership  the  work  would  neces- 
sarily progress  slowly,  and  the  needs  of  a  large  part 
of  the  population  would  be  far  less  rapidly  provided 
for  than  under  a  system  of  private  enterprise.  How 
far  this  may  be  true  in  some  countries  it  would  per- 
haps be  difficult  to  say,  but  this  has  certainly  not  been 
the  case  in  New  Zealand.  The  area  of  New  Zealand, 
it  \vill  be  remembered,  is  as  nearly  as  possible  two- 
thirds  that  of  the  State  of  California,  while  the  whole 
number  of  its  people  is  at  the  present  time  consider- 
ably less  than  one  million  and  sixty  thousand  persons, 
including  in  the  number  the  Maoris,  or  native  inhab- 
itants of  the  country.  There  are  now  constructed,  and 
in  full  operation  more  than  two  thousand,  eight  hun- 
dred miles  of  railroads  owned  by  the  people  of  New 
2^aland,  and  operated  by  the  Government  on  their  be- 


OWNEESHIP  OF  PUBLIC  UTILITIES     201 

half.  These  railroads,  with  the  exception  of  two  short 
lines,  built  by  private  enterprise,  and  subsequently  ac- 
quired by  the  State,  have  all  been  built  by  the  Gov- 
ernment, and  for  a  good  many  years  the  engines  and 
other  rolling  stock  used  has  been  constructed  in  the 
railway  workshops  of  the  country.  About  a  thousand 
miles  of  these  railroads  have  been  built  during  the  last 
twenty  years,  and  there  is  now  a  main  trunk  line  run- 
ning through  the  greater  part  of  both  the  islands  of 
which  the  country  consists,  with  a  number  of  branch 
lines  connecting  the  Trunk  lines  with  the  various  porta. 
The  total  expenditure  on  building  and  equipping  these 
lines  has  been  as  nearly  as  possible  a  hundred  and 
forty-eight  million  dollars,  which  includes  about  eight 
million  dollars  paid  for  the  two  short  lines  purchased 
by  the  Government  a  few  years  ago.  The  cost  of  the 
railroads,  including  land  compensation,  and  equip- 
ment of  all  kinds,  has  varied  at  different  periods  dur- 
ing the  thirty-five  years,  owing  to  the  difference  in  the 
price  of  labour  and  materials,  as  well  as  the  varying 
character  of  the  country  through  which  they  were  built ; 
on  the  whole,  however,  the  capital  invested  by  the  coun- 
try has  amounted  to  as  nearly  as  possible  $52,850 
(£10,750)  a  mile. 

When  it  is  remembered  that  for  many  years  of  the 
earlier  railroad  construction  not  only  the  skilled  labour 
required,  but  practically  every  rail,  car,  and  engine 
used,  had  to  come  from  the  opposite  side  of  the  world 
it  will  be  apparent  that  the  people  of  New  Zealand 
were  not  seriously  overcharged  for  what  they  have  got; 
and  her  people  have  at  least  the  satisfaction  of  knowing 


202      SOCIAL  WELFAEE  IN  NEW  ZEALAND 

that  they  have  not  been  imposed  on  by  a  system  of 
over-capitalisation.  As  an  answer  to  those  who  claim 
that  a  Government  can  never  compete  with  private  en- 
terprise in  keeping  up  with  the  needs  of  a  nation  — 
especially  in  a  young  country,  not  yet  fully  occupied  — 
in  the  primary  Utility  of  transport,  the  experience  of 
New  Zealand  would  seem  to  be  conclusive.  In  that 
very  young,  and  very  remote  country  the  needs  of  the 
people,  scattered  thinly  over  two  islands  that  are  nat- 
urally by  no  means  easy  of  access  from  the  harbours, 
have  been  supplied  with  facilities  of  railway  transport 
for  themselves  and  their  produce  to  an  extent  that  is 
greater  per  head  of  the  population  than  those  of  any 
other  country  in  the  world.  The  statement  may  ap- 
pear startling  and  almost  incredible  to  Americans,  who 
have  been  accustomed  to  hear  that  the  enterprise  of 
their  owoi  railway  kings  and  others  has  enabled  their 
country  to  leave  all  others  behind  in  this,  as  well  as  in 
many  other  respects ;  but  it  is  none  the  less  true.  And 
while  this  is  literally  true  in  the  case  of  America,  it  is, 
of  course,  vastly  more  true  of  every  country  of  Europe. 
The  civilised  world  agrees  that  American  capitalists 
have  far  exceeded  in  this  respect  the  entei'prise  sho^vn 
by  older  countries.  It  is  hardly  possible  in  the  face  of 
these  facts  to  doubt  that  the  enterprise  of  a  united  peo- 
ple—  even  a  small  one  —  may  exceed  even  that  shown 
by  the  great  railroad  promoters  of  America. 

To  such  a  claim  as  this  there  may  be  found  one  an- 
swer at  least.  If  it  is  true  that  the  people  of  New  Zea- 
land have  been  reckless  enough  to  borrow  vast  sums  of 
money  for  the  purpose  of  building  railroads  that  must 


OWNERSHIP  OF  PUBLIC  UTILITIES     203 

be  in  excess  of  their  real  needs ;  and  if  they  have  found 
people  in  England  foolish  enough  to  lend  it  them  for 
purposes  that  could  not  possibly  pay  a  decent  return  on 
the  investment,  that  is  no  proof  of  the  success  of  the 
system  which  allows  Governments  to  interfere  with  mat- 
ters they  evidently  don't  understand.  It  may  be  true 
that  the  people  and  Government  of  ISTew  Zealand  have 
sho^\^l  themselves  clever  enough  and  honest  enough  to 
get  fair  work  done  for  the  money  invested  in  their  rail- 
roads —  though  it  seems  almost  too  good  to  be  true  — 
but  now  that  they  have  got  them  it  would  puzzle  cleverer 
people  than  they  can  very  well  be  to  make  it  pay.  Such, 
we  can  well  believe,  would  be  the  answer,  and  the  per- 
fectly honest  answer,  of  every  American  railroad  ex- 
pert on  reading  the  statement  made  above  as  to  the  ex- 
tent of  the  railroad  facilities  provided  in  ISTew  Zealand 
under  Government  control. 

It  should  be  interesting  to  learn  that  experience,  in 
this,  as  in  other  matters,  has  absolutely  contradicted  the 
anticipations  of  the  men  who  argue  on  the  lines  of  busi- 
ness economics  as  taught  in  colleges  and  practised  in 
Wall  street.  The  Xew  Zealand  railroads  have  been  a 
great,  and  are  to-day  an  increasing  success.  It  is  true 
they  offer  no  field  for  speculation.  It  is  true  there  is 
no  room  for  the  operations  of  either  bulls  or  bears  in  re- 
lation to  the  hundred  and  forty-eight  million  dollars 
they  represent,  which  may  therefore  be  looked  on  as  so 
much  dead  money,  from  the  Wall  street  point  of  view. 
On  the  other  hand  the  people  of  IsTew  Zealand  have  been 
growing  wealthy  on  the  results  of  the  national  specula- 
tion.    They  have  been  able  to  settle  on  good  lands  that 


204      SOCIAL  WELFARE  IN  NEW  ZEALAND 

would,  but  for  these  railroads,  have  been  inaccessible, 
and  to  send  their  produce  to  markets  at  reasonable  cost 
that  but  for  the  public  ownership  of  the  lines  would 
have  been  impossible.  They  have  travelled,  and  their 
goods  have  travelled  over  the  publicly  owned  railroads 
at  rates  lower  —  in  most  cases  very  much  lower, —  than 
those  which  the  railroad  authorities  of  America,  or  of 
England  are  ready  to  denounce  as  ruinous. 

These  facts  supply  the  answer  to  the  second  objection 
generally  made  to  the  idea  of  Government  ownership  of 
Public  Utilities,  that  in  the  hands  of  Government  offi- 
cers they  would  be  far  more  costly  to  the  public  than 
they  are  in  the  hands  of  private  compames,  and  would 
not,  besides,  give  as  good  a  service.  Once  more  let  us 
turn  to  the  record  of  experience,  as  the  only  ultimate  and 
reliable  court  of  appeal  from  the  self-satisfied  conclu- 
sions of  theorists.  Twenty  years  ago,  as  has  been  men- 
tioned before,  the  railroads  of  New  Zealand  covered  a 
mileage  of  about  eighteen  hundred  miles.  In  the  year 
1891  the  trains  ran  altogether, —  including  both  pas- 
senger and  freight  trains  —  nearly  two  million  nine 
hundred  thousand  miles  over  the  various  lines.  They 
carried  fully  three  million  five  hundred  thousand  pas- 
sengers, and  in  addition  about  one  million  six  hundred 
thousand  tons  of  produce,  as  well  as  one  million  three 
hundred  and  fifty-eight  thousand  head  of  stock,  includ- 
ing horses,  cattle,  sheep  and  pigs,  to  the  markets  and 
ports  of  the  colony.  The  earnings  of  the  lines  of  rail- 
way in  that  year  were  very  nearly  $5,500,000  while  the 
total  expenditure  for  wages,  and  for  keeping  the  lines 
and  equipment  in  good  repair,  amounted  to  close  upon. 


OWNEESHIP  OF  PUBLIC  UTILITIES     205 

$3,400,000  (seven  hundred  thousand  pounds  sterling). 
This  left,  as  the  margin  of  earnings  over  and  above  the 
cost  of  operating  the  lines,  a  sum  of  but  little  over 
$2,000,000  (four  hundred  and  ten  thousand  pounds 
sterling),  as  the  net  revenue  available  for  payment  of 
interest  on  the  capital  invested. 

Twenty  years  later,  while  the  population  of  the  coun- 
try had  increased  almost  exactly  one-third,  the  mileage 
of  the  people's  railroads  had  increased  by  as  nearly  as 
possible  a  thousand  miles  —  that  is  to  say  by  consid- 
erably more  than  a  third  in  length.  The  extension  of 
the  lines  had,  it  will  be  observed,  been  made  from  year 
to  year,  and  the  capital  invested,  as  in  the  case  of  the 
earlier  works,  had  been  borrowed  on  the  public  credit  in 
the  English  money  market.  The  average  cost  of  con- 
struction had  not  greatly  altered,  for  though  much  more 
of  the  material  was  produced,  and  much  more  of  the 
work  was  done  in  the  country  than  had  formerly  been 
the  case,  the  higher  rates  of  wages  that  prevailed  fully 
made  up  for  this,  so  that  the  cost  of  the  whole  sys- 
tem of  the  country's  railroads  had  up  to  that  time 
been  nearly  a  hundred  and  fifty  million  dollars 
(about  thirty  million  pounds  sterling.)  This  included 
both  construction  and  equipment,  and  involved  an 
annual  payment  in  interest  of  nearly  four  million 
five  hundred  thousand  dollars  —  (about  nine  hundred 
and  twenty  thousand  pounds  sterling).  The  train 
mileage  had  however  increased,  so  that  in  the  last  year 
of  the  twenty,  instead  of  nmning  nearly  two  million 
miles  over  the  lines,  trains  had  run  more  than  eight 
million    miles,    or   more   than    three    times    as    many 


206     SOCIAL  WELFARE  IIT  NEW  ZEALAND 

miles  as  they  did  twenty  years  before.  Instead  of  tliree 
and  a  half  millions  of  passengers,  they  now  carried  fully 
twelve  and  a  half  millions  in  a  year:  instead  of  one 
million  six  hundred  thousand  tons  of  freight,  more  than 
four  million  six  hundred  thousand  tons  were  carried; 
and  instead  of  one  million  three  hundred  and  fifty-eight 
thousand  head  of  live  stock  more  than  five  million,  seven 
hundred  thousand  head  were  carried  over  the  various 
lines. 

In  the  meantime  the  rates  either  for  passengers  or 
freight  were  not  materially  altered,  and  certainly  not  in- 
creased on  the  whole.  For  passengers  the  uniform  fare 
was  one  penny  —  less,  that  is,  than  two  cents  —  per 
mile,  and  though  it  is  impossible  here  to  give  the  freight 
rates  in  detail,  owing  to  the  variety  of  goods  carried  for 
which  different  charges  are  made,  it  may  be  stated  gen- 
erally that  the  freight  rates  per  mile  are  less  on  the 
New  Zealand  lines  than  on  those  of  America.  The  pas- 
senger fares,  which  in  1891  had  amounted  on  the  whole 
to  $1,700,000— (about  three  hundred  and  fifty-four 
thousand  pounds), —  had  increased  to  more  than 
$6,000,000  —  (one  million  two  hundred  and  fifty  thou- 
sand pounds)  ;  —  the  revenue  from  goods  and  live  stock 
carried,  which  twenty  years  before  had  amounted  to 
barely  three  and  a  half  million  dollars  —  (seven  hun- 
dred and  twenty-eight  thousand  pounds), —  amounted 
last  year  to  considerably  over  ten  million  dollars  — 
(about  two  million,  two  hundred  thousand  pounds). 
This,  it  will  be  observed,  means  an  increase  of  about 
two  him.dred  per  cent,  in  the  revenue  derived  from  the 
people's  railroads  in  twenty  years.     In  1891  the  reve- 


OWNEESHIP  OF  PUBLIC  UTILITIES     207 

nue,  as  previously  stated,  had  left,  after  payment  of  all 
expenses  of  operation  and  upkeep,  a  margin  of  about 
two  and  nine-tenths  per  cent,  on  the  capital  invested,  on 
■which  fully  three  and  a  half  per  cent,  was  due:  in  1910 
it  left,  after  payment  of  all  expenses  of  operation,  a 
margin  of  three  and  three-quarters  per  cent,  on  the 
greatly  increased  amount  of  capital  invested  —  an 
amount  more  than  sufficient  to  cover  the  amount  of  the 
interest  payable  on  the  hundred  and  fifty  million  dol- 
lars borrowed  for  the  construction  of  their  national  rail- 
roads. 

Thus  the  experience  of  ISTew  Zealand  in  railway  con- 
struction and  operation  in  the  last  twenty  years  —  the 
period  in  which  the  policy  of  State  Socialism  may  be 
said  to  have  been  on  its  trial  in  that  country  —  may 
fairly  be  summed  up  in  this  way :  —  It  has  proved  that 
railroads  can  be  built,  equipped,  and  operated,  as  hon- 
estly and  as  cheaply  by  an  honest  Government  as  they 
can  by  a  company  of  capitalists.  It  has  shown  besides, 
that  they  can  be  constructed  under  conditions  that  would 
appeal  to  no  railroad  promoters,  but  which  may  very 
greatly  improve  the  conditions  of  a  peoj^le,  and  so 
greatly  increase  the  wealth  of  a  nation.  It  has  shown 
finally,  that  as  it  can  be  no  advantage  to  a  people  to 
make  profits  at  its  own  expense,  and  as  a  nation  can 
always  borrow  money  at  a  rate  much  lower  than  a 
private  company,  the  services  rendered  by  a  real  rail- 
road of  the  people  to  the  people,  can  always  be  provided 
at  a  lower  rate  than  private  capital  could  ofier. 

The  experience  of  New  Zealand  in  the  installation 
and  working  of  a  telegraph  service  has  now  extended 


208      SOCIAL  WELFARE  IN  NEW  ZEALAND 

over  a  good  many  years,  and  it  may  be  said  to  be  con- 
clusive on  two  points  at  least,  that  concern  the  question 
of  the  advantage  of  this  great  modem  utility  for  a  peo- 
ple being  placed  in  Government,  rather  than  in  private 
hands.  It  is  claimed  that  American  corporations  have 
shown  great  enterprise  in  the  installation  of  electrical 
services  throughout  the  country :  it  may  be  claimed  with 
perfect  confidence  that  Government  ownership  in  New 
Zealand  has  resulted  in  a  larger  provision  being  made 
for  the  needs  of  the  people,  whether  the  comparison  is 
made  on  the  basis  of  population,  or  of  the  area  of  the 
country  supplied.  It  is  claimed  that  the  telegraph 
services  rendered  by  the  great  American  corporations 
are  good  and  reliable :  it  is  not  less  true  that  the  New 
Zealand  telegraph  services  are  prompt  and  efficient, 
while  it  is  true  in  New  Zealand  that  secrecy  can  always 
be  relied  upon,  as  the  disclosure  of  the  contents  of  a 
message  renders  the  operators  liable  to  punishment  for 
a  felony.  In  addition  it  may  be  said  that  Government 
ownership  in  New  Zealand  has  resulted  in  securing  to 
the  people  the  use  of  the  telegraph  at  so  cheap  a  rate 
that  this  particular  utility  is  made  use  of  by  the  people 
to  an  extent  that  very  far  exceeds  that  of  any  other 
country  in  the  world. 

Twenty  years  ago  the  telegraph  services  of  New  Zea- 
land were  provided  for  by  the  installation  of  about  five 
thousand  miles  of  lines,  which  gave  Avhat  was  then  con- 
sidered a  fairly  sufficient  service  for  the  needs  of  two- 
thirds  of  a  million  inhabitants.  Since  that  time  under 
a  system  of  extended  State  Socialism,  the  telegraphic 
conveniences  of  the  people  have  been  greatly  extended, 


OWNEESHIP  OF  PUBLIC  UTILITIES     209 

and  the  cost  of  sending  messages  has  been  correspond- 
ingly diminished.  There  are  now  nearly  11,500  miles 
of  lines  through  the  country,  extending  to  every  country 
district  in  which  there  is  need  of  a  post  office.  These 
lines  carry  fully  thirty-six  thousand  miles  of  wires,  over 
which  there  were  sent  during  the  year  nearly  nine 
million  messages  to  supply  the  requirements  of  a  little 
more  than  a  single  million  of  people.  The  cause,  it 
need  hardly  be  said,  of  the  extraordinary  use  made  of 
the  telegraph  by  the  people  of  New  Zealand  is  that  it  is 
cheap  as  well  as  good.  There  is  no  difficulty  even  at 
the  rates  charged,  which  enables  a  message  of  twelve 
words  to  be  sent  a  thousand  miles  for  less  than  twelve 
cents — (sixpence) — in  obtaining  from  the  service  a 
revenue  sufficient  to  pay  the  cost  of  operation  and  up- 
keep, as  well  as  interest  on  the  money  originally  in- 
vested in  the  installation  of  the  line.  This,  it  may  be 
noted,  illustrates  once  more  the  great  saving  to  the  Com- 
munity at  large  secured  by  placing  this  very  important 
utility  in  the  hands  of  the  Government  instead  of  those 
of  a  corporation.  The  cost  of  installation  is,  of  course, 
reduced  by  the  amount  of  the  difference  between  the  in- 
terest paid  by  a  nation  on  its  loans  and  a  corporation  on 
its  capital  —  even  where  that  capital  is  not  apparently 
increased  by  watering  the  stock.  The  cost  of  operation 
is  almost  equally  reduced  by  the  fact  that  a  Government 
has  already  post  offices  at  every  centre  of  population, 
and  has  therefore  no  need  for  separate  offices,  or  sep- 
arate operators,  except  at  large  centres,  where  there  is 
likely  to  be  a  great  amount  of  business  done.  At  these 
smaller  centres  each  post  office  naturally  becomes  also  a 


210     SOCIAL  WELFARE  m  NEW  ZEALAND 

telegraph  oflSce,  and  each  postmaster  or  mistress  is  re- 
quired to  be  a  competent  telegraph  operator.  It  is  now 
a  good  many  years  since  New  Zealand  established  an 
ocean  cable  service  between  New  Zealand  and  Australia, 
by  means  of  which  cable  messages  can  be  sent  to  any  of 
the  Australian  States  at  the  rate  of  ten  cents  per  word. 

The  establishment  of  public  telephone  services  is,  of 
course,  more  recent  than  that  of  the  telegraph  in  New 
Zealand,  as  elsewhere,  but  even  in  the  comparatively  few 
years  of  its  existence  it  has  made  progress  to  an  extent 
not  exceeded  by  any  other  community  in  proportion  to 
its  population,  while  it  is  far  in  advance  of  most.  In 
the  year  1910  there  were  thirty-three  telephone  centres 
in  the  country,  and  a  hundred  and  twenty-five  sub-ex- 
changes, while  the  number  of  private  connections  in  the 
country  in  that  year  considerably  exceeded  thirty  thou- 
sand, and  were  apparently  increasing  at  the  rate  of  fully 
three  thousand  in  each  year.  The  expense  of  these 
private  telephone  connections  is  a  little  less  than  $15  per 
annum.  At  this  rate  the  service  is  fully  self-support- 
ing, the  revenue  derived  from  it  last  year  being  fully 
$700,000  —  (about  a  hundred  and  forty-six  thousand 
pounds)  and  leaving  a  margin,  after  providing  all  ex- 
penses of  operation,  upkeep,  and  interest  on  the  capital 
invested. 


CHAPTER  y 

OWNERSHIP  OF  MINOR  UTILITIES 

The  legitimate  meaning  of  the  new  term  Public 
Utilities  has  not  jet  been  defined  by  any  autbority,  but 
it  may  fairly  be  understood  as  meaning  anything  that 
has  been  found  by  experience  generally  necessary  or 
greatly  conducive  to  the  well-being  of  the  great  ma- 
jority of  a  people.  We  have  dealt  in  the  last  chapter 
with  the  Utilities  of  communication  within  a  country, 
for  goods  or  passengers,  or  for  business  or  private  in- 
telligence, which  are  so  clearly  utilities  affecting  the 
physical  and  material  well-being  of  a  large  proportion 
of  the  citizens  of  a  modem  and  civilised  nation  that  it 
is  difficult  to  imagine  any  serious  objection  being  made 
to  the  use  of  the  term  Public  Utilities  in  their  case.  It 
is  true  that  even  fifty  years  ago  no  one  of  the  three 
would  probably  have  been  recognised  as  coming  within 
the  definition,  and  it  is  equally  true  that  within  the  next 
half  century  many  other  things,  not  thought  of  at  pres- 
ent, will  of  necessity  be  added  to  the  list  of  public  utili- 
ties. There  are,  indeed,  even  to-day,  not  a  few  things  so 
far  necessary  or  conducive  to  a  people's  well-being  that 
they  may  fairly  lay  claim  to  recognition  as  entitled  to 
take  rank  as  coming  within  the  class  of  Minor  Public 
Utilities.     It  is  with  some  of  these,  that  have  already 

211 


212     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

been  for  Bome  years  dealt  with  in  New  Zealand  as  be- 
longing to  the  class  of  Utilities,  that  it  is  proposed  to 
deal  in  the  present  chapter. 

Much  has  been  said  and  written,  by  those  who  more 
or  less  distinctly  advocated  the  continuance  of  the  con- 
ditions of  extreme  riches  and  poverty  that  have  so  long 
existed,  as  to  the  reckless  improvidence  of  the  poorer 
members  of  the  labouring  classes.  From  their  point 
of  view  it  would  seem  all  but  hopeless  to  devise  any  plan 
by  which  this  almost  constitutional  tendency  to  ex- 
travagance in  the  present,  and  total  improvidence  for  the 
future  can  be  cured  —  a  conclusion  which,  perhaps  nat- 
urally, leads  them  to  cast  the  responsibility  on  Provi- 
dence, and  accept  the  social  conditions  of  contrasted 
riches  and  poverty  as  quite  inevitable,  if  not  even  de- 
sirable. To  those,  however,  who  take  a  somewhat  more 
hopeful,  and  less  prejudiced  view  of  society,  it  has 
occurred  that  the  unquestionable  fact  that  very  much 
the  larger  part  of  every  civilised  nation  at  the  present 
time  has  too  little  of  everything  that  constitutes  even  the 
most  moderate  degree  of  well-being,  goes  far  to  account 
for  and  excuse  any  want  of  provident  care  for  the  fu- 
ture. Before  condemning  the  improvidence  of  a  class 
of  persons  thus  situated  it  seems  to  them  only  fair  as 
well  as  reasonable  to  make  an  effort  to  place  these  peo- 
ple in  a  position  in  which  they  may  have  something  to 
save,  and  to  provide  opportunities  for  saving  any  sur- 
plus they  may  have  that  are  at  once  convenient  and  at- 
tractive. 

It  was  in  the  hope  of  doing  something  of  this  kind  for 
the  workers  of  New  Zealand  that  the  Legislature  of  the 


OWI^ERSHIP  OF  MINOR  UTILITIES     213 

country  originally  adopted  the  idea  of  establishing  Sav- 
ings Banks  in  connection  with  the  Post  Office  Depart- 
ment of  the  Government.  The  idea  is  one  that  is  now 
happily  familiar  to  the  public  both  of  America  and 
England,  as  it  has  been  more  or  less  extensively  adopted 
in  both  countries  during  the  last  few  years,  but  it  may 
be  none  the  less  interesting  to  refer  to  it  here,  in  deal- 
ing with  the  country  of  its  origin,  in  which  it  has  had  a 
longer  trial,  to  show  the  effect  which  it  has  apparently 
produced,  and  some  of  the  conclusions  that  may  be 
drawn  from  it. 

It  was  in  the  year  1867  that  the  Government  of  'New 
Zealand  was  first  authorised  to  add  a  Savings  Bank  de- 
partment to  the  ordinary  business  of  the  Post  Office. 
From  the  first  the  new  experiment  became  a  success. 
The  old  Savings  Banks  were  not  apparently  much  af- 
fected by  it,  as  the  number  of  depositors  and  the  amount 
of  their  deposits  continued  to  increase  steadily  year 
after  year,  but  the  remarkable  result  was  shown  in  the 
use  that  w^as  made  of  the  new  facilities  given  them  by 
the  people  in  the  country  districts  and  small  townships. 
Between  1867  and  1891  —  a  period  of  twenty-four 
years  —  the  number  of  depositors  in  the  Post  Office 
Savings  Banks  of  the  young  country  increased  from  the 
starting  point  to  a  total  of  fully  135,000  depositors, 
while  the  amount  of  money  deposited  in  the  last  year 
of  the  period,  and  remaining  to  the  credit  of  the  de- 
positors at  the  end  of  that  year,  had  reached  the  large 
sum  of  fully  $17,500,000 —  (£3,580,000),  an  average 
of  a  hundred  and  thirty  dollars  at  the  credit  of  each  ac- 
count.    The  number  of  the  population  of  European 


214     SOCIAL  WELFARE  IN"  NEW  ZEALAND 

origin  in  the  country  at  that  time,  it  must  be  remem- 
bered, was  only  six  bundred  and  tbirty-four  tbousand, 
so  tbat  tbe  result  of  tbe  supply  of  tbis  public  utility  to 
tbe  people  by  tbe  Government  bad  been  tbat  already,  at 
the  end  of  tbe  first  twenty-four  years'  experience,  tbere 
was  a  Savings  Bank  account  for  every  fiftb  person  in 
tbe  community. 

Tbe  results  of  tbe  last  twenty  years'  experience  —  tbe 
years  of  State  Socialism  —  bave  been  still  more  re- 
markable, and  may  ser^'e  to  show  not  only  tbe  extraordi- 
nary increase  of  tbe  prosperity  of  tbe  people  during  tbat 
time,  under  tbe  new  and  beretical  system  of  social 
economics,  but  also  tlie  assistance  by  tbe  supply  of 
facilities  for  personal  providence  given  by  tbe  Govern- 
ment interference  in  the  business  of  banking.  At  tbe 
end  of  the  twenty  years  the  numbers  of  the  people  bad 
increased  almost  exactly  one-third,  but  tbe  number  of 
Savings  Bank  deposit  accounts  bad  increased  very  nearly 
two  hundred  per  cent.  In  1891,  135,000  people  bad  ac- 
counts with  money  to  their  credit;  in  1911  very  nearly 
400,000  Savings  Bank  accounts  stood  to  tbe  credit  of 
depositors.  In  1891  tbe  total  amount  at  the  credit  of 
depositors  was  $17,500,000 — (£3,580,000):  twenty 
years  later  the  balance  standing  at  tbe  credit  of  the  four 
bundred  thousand  accounts  amounted  to  very  nearly 
$72,000,000  —  (rather  more  than  fourteen  millions 
sterling).  Thus  it  becomes  evident  that  while  the  ad- 
vantage taken  by  tbe  people  of  New  Zealand  of  the 
facilities  given  them  for  making  and  safely  depositing 
their  savings  in  the  twenty-four  years  ending  with  1891 
bad  been  tbat  every  fiftb  person  bad  a  Savings  Bank  ac- 


OWITEESHIP  OF  MINOK  UTILITIES     215 

count  with  money  to  his  or  her  credit,  in  twenty  years 
more  there  was  an  account  for  every  two  and  a  half  per- 
sons. 

From  what  has  been  said  it  may  readily  be  gathered 
that  during  the  last  twenty  years  the  readiness  of  the 
people  to  help  themselves  has  not  been  in  any  degree 
lessened  by  the  assistance  offered  by  the  novel  legislation 
of  the  country.  The  history  of  the  Savings  Bank  ex- 
perience of  l^ew  Zealand  alone  is  sufficient  to  prove  two 
things  beyond  reasonable  question.  It  proves  first  that 
the  supply  of  facilities  for  national  providence,  such  as 
only  a  people's  Government  can  provide  for  the  mass 
of  a  people  will  be  taken  advantage  of  to  an  extraordi- 
nary extent  by  that  part  of  the  population  that  has  been 
credited  w^ith  absolute  carelessness  and  indifference  in 
such  matters.  It  shows  also  in  a  very  startling  light 
the  fact  that  in  one  coimtry,  at  least,  the  heretical  prin- 
ciples of  State  Socialism  have  been  applied  during  the 
last  twenty  years  with  a  degree  of  success  in  producing 
general  prosperity  and  weU-being  among  the  people 
wholly  imparalleled  in  any  other  community  in  the 
world.  In  the  case  of  Xew  Zealand  the  increase  of 
Banking  accounts  does  not  mean  the  increase  of  the  pros- 
perity of  a  commercial  class,  but  that  of  the  class  that 
has  elsewhere  had  little  or  no  prosperity  whatever.  The 
four  hundred  thousand  Savings  Bank  accounts  of  to- 
day do  not  represent  the  riches  of  a  little  group  of  rich 
people,  but  of  a  large  class  of  workers  and  their  fami- 
lies. Among  them  there  are  no  large  accounts,  and 
very  few  indeed  that  contain  over  two  hundred  pounds 
($1,000).     The  average,  however,  is  higher  than  it  was 


216     SOCIAL  WELFARE  IN  NEW  ZEALAND 

twenty  years  ago,  for  it  now  amounts  to  about  $175 
(£36)  to  each  account,  while  it  was  only  about  $130 
(£26)  twenty  years  ago. 

So  far,  then,  as  the  Savings  Banks  of  New  Zealand 
go,  it  may  be  claimed  that  the  evidence  on  two  points  on 
which  inquiry  has  been  made  is  absolutely  conclusive. 
The  people  of  the  country  that  belong  to  the  class  of 
workers  —  that  class  which  in  other  countries  has  had 
little  or  no  means  of  exercising  the  self-respecting  vir- 
tue of  providence  for  the  future  —  have  shown,  them- 
selves both  able  and  willing  to  exercise  it  in  no  ordinary 
degree  when  the  opportunity  presented  itself.  When 
good  wages,  and  fair  treatment  made  it  possible  for  them 
and  their  families  to  live  decently,  and  yet  to  have 
something  over,  they  have  been  ready  and  willing  to 
save  it,  none  the  less,  but  rather  the  more,  because  the 
laws  of  their  country  recognised  to  the  full  the  claims 
of  those  who  in  the  past  had  no  such  opportunities.  The 
evidence  also  shows  that  for  some  reason  or  other 
higher  wages,  such  as  are  paid  in  New  Zealand  under 
the  awards  of  the  Arbitration  courts,  do  not,  as  they 
seem  to  do  in  America,  when  they  are  wrung  from  un- 
willing employers  by  means  of  industrial  war,  lead  to 
an  advance  in  rents  of  houses,  and  an  increase  in  the 
price  of  every  necessary  of  life,  that  leaves  the  work- 
man with  a  family  less  able  to  live  in  decent  comfort, 
and  even  less  able  to  exercise  providence  for  the  future 
than  he  was  before.  Its  meaning,  as  a  general  indi- 
cation of  the  prosperity  of  the  country  and  its  people 
also  can  hardly  be  mistaken.  It  does  not  mean,  in- 
deed, that  the  rich  men  of  the  country  —  of  whom,  for- 


OW:N'ERSinP  OF  MINOR  UTILITIES     217 

tiinately  there  are  very  few  —  none,  indeed,  that  wonld 
be  called  rich  in  America  to-day  —  have  been  growing 
much  richer ;  but  it  does  mean  that  the  part  of  the  peo- 
ple that  used  to  have  next  to  nothing  beyond  what  was 
needed  to  give  their  families  enough  to  eat  and  drink 
and  wear,  have  begun  to  save  money,  because  they  can 
earn  more  than  is  necessary  to  pay  for  these  things. 

The  Post  Office  Savings  Banks  pay  interest  at  the 
rate  of  four  per  cent,  on  the  amount  of  the  deposits,  but 
it  is  interesting  to  observe  that  the  money  deposited  in 
the  Banks  by  the  people  is  not  put  there  for  permanent 
investment,  but  merely  to  be  kept  till  it  is  wanted  for 
some  other  investment.  Last  year  while  the  total  bal- 
ance at  the  credit  of  depositors  was  fully  $70,000,000 
' —  at  the  rate  of  very  nearly  $70  for  every  man,  woman 
and  child  in  the  country  —  the  amount  dra"UTi  out  of 
the  accounts  during  the  year  for  use  in  some  other  way 
was  very  nearly  $50,000,000  —  (rather  more  than  ten 
million  pounds  sterling), —  while  rather  more  than  that 
amoimt  was  paid  in,  either  to  old  or  new  accounts  dur- 
ing that  time.  The  favourite  investment  for  which 
money  is  withdrawn  from  the  Banks  seems  to  be  the 
purchase  of  small  sections  of  land  in  the  suburbs  of  the 
larger  cities  on  which  the  buyers  look  forward  to  build- 
ing houses  as  homes  for  their  families.  It  is  this 
tendency  that  has  brought  about  the  situation  that  there 
are  now  more  than  ninety  thousand  persons,  out  of  a 
population  but  little  in  excess  of  a  million,  who  are 
returned  as  the  o\vner3  of  sections  of  what  are  known 
as  "  urban  land  " —  that  is  land  within  the  limits  of 
cities  or  their  suburbs. 


218      SOCIAL  WELFAEE  m  NEW  ZEALAND 

The  people  of  New  Zealand  are  mainly  British  in 
origin,  and  they  have  brought  to  the  new  country,  which 
is  at  once  so  like  and  so  unlike  the  home  of  their  race, 
many  of  the  social  ideals  that  were  in  old  times  so 
characteristic  of  their  ancestors:  among  these  the  love 
of  a  home  that  belonged  to  themselves  from  generation 
to  generation  was  perhaps  in  some  ways  the  strongest. 
It  was  with  a  more  or  less  definite  idea  of  securing  this 
that  most  of  the  original  settlers  found  their  way  to  the 
new  country,  and  they  have  undoubtedly  handed  it 
down  to  their  children.  The  ambition  of  a  large  pro- 
portion of  those  who  are  born  in  the  country  districts 
has  always  been  to  get  a  farm  of  their  own  where  they 
could  make  a  home,  not,  as  seems  so  generally  the  case 
in  America  now,  to  find  their  way  into  a  city  as  soon 
as  they  can  choose  for  themselves,  where  anything  even 
distantly  resembling  the  old  idea  of  a  decent  home  is  for 
most  of  them  almost  impossible.  This  desire  to  pos- 
sess land  and  a  home  of  their  own  has  been  steadily 
encouraged  in  New  Zealand,  by  offering  —  as  has  al- 
ready been  explained  in  a  former  chapter  —  good  farm- 
ing lands  in  nearly  every  part  of  the  country  on  terms 
that  make  it  easy  for  almost  anybody  acquainted  with 
country  life  to  get  a  farm,  and  improve  it  by  his  labour 
with  very  little  expenditure  of  capital.  A  considerable 
variety  of  tenures  were  offered,  on  which  the  land  could 
be  held  —  some  of  them  so  new  to  people  in  England, 
from  which  most  of  the  capital  came  that  was  available 
for  investment  on  loan  within  the  colony,  that  they  — 
or  rather  the  companies  that  generally   acted   as  the 


OWl^ERSHIP  OF  MINOR  UTILITIES      219 

lenders  of  money  on  mortgage  whicli  tliey  obtained  in 
England  —  hesitated  to  advance  money  on  any  but  free- 
hold land,  or,  where  they  did  make  loans  on  such  se- 
curity, expected  to  receive  high  rates  of  interest,  on  the 
ground  that  the  security  was  not  so  good. 

It  was  this  fact  more  than  any  other  that  first  in- 
duced the  Government  to  enter  on  business  as  a  lender 
of  money  to  the  people  on  mortgage  of  lands  held  under 
tenures  that  were  meant  to  assist  that  part  of  the  peo- 
ple possessed  of  little  caf)ital  beyond  their  own  skill  and 
energy.  Where  such  loans  could  be  secured  from  finan- 
cial companies  or  private  capitalists  interest  at  the  rate 
of  eight  per  cent,  was  usually  charged,  and  the  burden 
was  found  to  be  a  heavy  one,  sufficiently  so,  indeed  to 
discourage  many  from  taking  land  on  those  terms.  Such 
a  state  of  things  was  recognised  as  being  distinctly  in- 
consistent with  the  social  ideals  that  were  rapidly  gain- 
ing ground  in  New  Zealand,  which  we  have  named 
those  of  State  Socialism.  It  was  certain  that  the  Com- 
munity, as  a  whole,  could  borrow  as  much  money  as  it 
required  at  from  three  to  three  and  a  half  per  cent,  in 
the  English  money  market;  it  appeared  ridiculous,  as 
well  as  unjust,  that  the  part  of  the  people  of  New  Zea- 
land that  for  the  time  being  had  only  the  capital  of 
their  skill,  and  energy,  should  be  prevented  from  adding 
to  the  wealth  of  the  community  as  well  as  of  their  own 
families  by  being  called  on  to  pay  twice  as  much  for 
the  least  valuable  part  of  the  capital  that  was  needed 
as  it  could  be  supplied  for  by  the  nation  as  a  whole. 
The  result  was  that  the  Government  was  authorised  by 


220      SOCIAL  WELFARE  IN  NEW  ZEALAND 

the  Legislature  to  borrow  what  was  required  and  to  ad- 
vance it  on  loan  to  the  settlers  for  the  improvement  of 
their  farms. 

This  experiment  in  the  line  of  State  Socialism  was 
begun  six  years  ago,  so  that  it  has  not  yet  had  many 
years  of  trial  to  record.  It  is  possible,  too,  that  ex- 
ception may  be  taken  to  it  as  one  of  even  the  minor 
Public  Utilities  of  a  people.  Whatever  may  be  said, 
however,  on  this  subject  from  the  point  of  view  of 
other  and  older  countries,  there  can  be  little  question 
that  for  a  country  like  New  Zealand,  and  a  people  like 
the  citizens  of  that  country,  the  system  has  all  the  gen- 
eral features  of  a  public  utility,  especially  in  the  ex- 
tended form  it  has  since  assumed,  covering  the  needs 
of  workers  in  cities,  as  well  as  settlers  in  the  country. 
It  need  not  be  pointed  out  that  high  interest  on  money 
lent  is  the  main  weapon  by  means  of  which  commer- 
cialism has  flourished  for  centuries ;  by  which  the  class 
of  the  rich  has  grown  richer,  and  that  of  the  poor  has 
become  more  impoverished  in  every  civilised  country. 
Eor  many  centuries  capital  has  been  recognised  as  the 
Money  God  of  commercialism,  while  the  interest  for  its 
use  has  been  the  burnt  offering  brought  to  its  shrine.  It 
may  be  questioned  whether,  for  the  promotion  of  jus- 
tice between  class  and  class,  and  of  the  well-being  of 
the  great  majority  of  any  people,  there  can  be  any  pub- 
lic utility  more  required  to-day  than  that  of  capital 
obtainable  at  low  rates  of  interest  on  a  reasonable  se- 
curity for  repayment.  It  was  the  recognition  of  this 
truth  that  led  to  the  New  Zealand  system  of  "  Advances 
to  Settlers  "  in  the  first  instance,  and,  as  a  further  step 


OWNEESHIP  OF  MINOR  UTILITIES     221 

in  the  same  direction,  to  that  of  "  Advances  to  Work- 
ers." 

Within  five  years  a  sum  of  $45,000,000  —  (fully  nine 
million  pounds  sterling), —  had  been  actually  lent  by 
the  nation  to  settlers  on  the  land,  to  be  used  by  them  for 
the  increase  of  the  agricultural  production  and  pros^ 
perity  of  the  country.  Its  most  marked  result  has 
been  the  large  and  steady  increase  in  the  number  of 
small  farms,  and  the  great  increase  in  the  dairy  prod- 
uce of  the  country,  which  seems  to  be  its  consequence. 
The  small  farms  of  Xew  Zealand  are  for  the  most  part 
used  for  dairy  farming,  as,  under  the  system  of  co- 
operative milk  and  cheese  factories  which  has  been  en- 
couraged in  every  possible  way  by  legislation  during  the 
last  ten  years,  small  farm  settlers  can  apparently  make 
a  success  with  much  less  capital  than  is  required  for 
farming  of  any  other  kind.  Milk  or  cheese  factories 
are  now  to  be  found  within  easy  distance  of  the  sur- 
rounding farms  in  every  part  of  the  country  where  close 
settlement  prevails,  and  though  there  are  many  scat- 
tered farms  that  are  beyond  the  reach  of  this  advantage, 
the  vast  majority  are  in  touch  with  one  of  these  fac- 
tories. 

The  produce  of  both  butter  and  cheese  has  increased 
at  a  rate  that  seems  almost  phenomenal  during  the  last 
few  years  till  last  year  it  had  reached  a  point  at  which 
the  export  —  almost  wholly  to  the  English  market, 
where  good  prices  are  always  obtainable  for  New  Zea- 
land dairy  products  —  of  butter  from  the  country  had 
reached  a  total  of  about  thirty-eight  million  pounds  in 
weight,  and  that  of  cheese  a  little  more  than  fifty  mil- 


222     SOCIAL  WELFAEE  IK  IN^EW  ZEALAND 

lion  pounds.  The  value  of  these  exports  alone  to  !N"ew 
Zealand  amounted  to  more  than  fifteen  dollars  per  head 
of  the  whole  population  —  a  result  which  was  very 
largely  though  not  entirely  due  to  the  system  of  Govern- 
ment advances  to  settlers.  The  advances  of  money  to 
increase  the  prosperity  of  the  farming  population  has  not 
stopped  short  at  advance  of  money  on  mortgage  of  their 
farms,  however.  Advances  have  been  made  to  dairy  as- 
sociations of  a  co-operative  character  to  enable  them  to 
build  and  equip  butter  and  cheese  factories  in  their 
own  neighbourhoods,  wherever  it  appeared  that  such  in- 
stitutions were  needed  by  the  farmers  of  the  district,  and 
there  was  a  fair  prospect  of  sufficient  support  to  make 
the  investment  pay.  This  has  always  been  ascertained 
by  Government  inspection  whenever  application  was 
made  for  such  assistance,  and  the  capital  thus  advanced 
has  been  secured  by  bonds  entered  into  by  representa- 
tives of  the  proposed  co-operative  society  to  repay  the 
advances  made  by  the  annual  payment  of  five  per  cent, 
to  cover  interest  and  a  sinking  fund  to  repay  the  prin- 
cipal. 

As  has  been  already  mentioned  in  this  chapter  the 
principle,  introduced  six  years  ago  in  the  case  of  coim- 
try  settlers,  of  treating  their  need  of  assistance  by  the 
advance  of  capital  on  liberal  terms  as  a  public  utility 
to  be  provided  by  the  Community  as  a  whole,  has  since 
then  been  extended  to  another  class  —  that  of  "  The 
Workers."  The  meaning  of  the  term  "  worker  "  is  de- 
fined by  the  statute  as  any  person,  whether  male  or 
female,  who  is  engaged  in  work  (whether  as  an  em- 
ploye or  on  their  own  account)  in  manual  or  clerical 


OWl^EESHIP  OF  MINOR  UTILITIES     223 

work,  who  at  the  time  of  making  the  application  for  a 
loan  is  not  in  receipt  of  an  income  of  two  himdred 
pounds  ($975),  and  is  not  the  owner  of  any  land,  other 
than  the  land  which  he  offers  in  security  for  the  loan 
for  which  application  is  made.  In  ISTew  Zealand  this 
definition  practically  includes  nearly  all  classes  of  per- 
sons engaged  in  labouring  or  mechanical  pursuits,  as 
well  as  all  jimior  clerks  or  school  teachers.  It  will  be 
seen,  therefore,  that  it  appeals  to  the  needs  of  a  very 
large  proportion  of  the  people,  who  are  thus  given  an 
opportunity  beyond  the  reach  of  persons  in  their  sit- 
uation in  almost  any  other  country.  Little  need  be 
said  to  the  citizens  of  America  as  to  the  need  of  some 
such  opportunity  for  the  inhabitants  of  cities,  where 
homes,  in  any  reasonable  sense  of  the  word,  are  simply 
unattainable;  and  while  this  is  less  true  in  a  young 
country  like  ISTew  Zealand,  the  want  is  one  that  is  real 
and  widely  felt  by  those  who  live  and  work  in  cities. 
For  this  reason  the  provision  made  for  securing  homes 
for  the  people  has  been  placed  here  among  the  minor 
Public  Utilities  —  not  indeed  needed  by  the  whole  pop- 
ulation, but  extremely  beneficial  to  a  very  large  class, 
and  that  the  class  that  has  the  most  need  of  such  an  op- 
portunity. 

As  the  conditions  on  which  assistance  will  be  given  by 
the  nation  to  individuals  for  home  building  demand  the 
offer  of  security  by  the  borrower  to  secure  the  payment 
of  interest,  and  the  repayment  of  the  money  advanced, 
it  was  natural  that  at  first  only  a  small  number  of  the 
people  would  be  ready  to  take  advantage  of  the  oppor- 
tunity offered.     The  statute  has  been  in  force  during 


224     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

the  last  four  years  only,  and  while  experience  has  shown 
that  at  first  few  people  were  prepared  to  offer  the  re- 
quired security  of  a  piece  of  land  on  which  a  home 
could  be  built,  the  number  of  such  persons  has  increased 
steadily  year  by  year.  Only  a  hundred  and  sixty  loans 
were  applied  for  during  the  first  year,  and  of  these  only 
about  two-thirds  were  approved  by  the  Board  entrusted 
with  the  management  of  the  system.  In  the  second 
year,  however,  the  number  of  applications  had  risen  to 
1,150,  of  which  all  but  about  seventy  were  approved  — 
the  amount  advanced  averaging  as  nearly  as  possible 
$1,000  (rather  more  than  two  hundred  pounds)  in  each 
case.  In  the  third  year  twelve  hundred  and  twenty  ap- 
plications were  granted,  and  one  million  four  hundred 
and  ninety  thousand  dollars  (about  three  hundred  thou- 
sand pounds),  were  actually  advanced,  showing  that  a 
demand,  not  only  for  a  larger  number,  but  for  an  im- 
proved class  of  workers'  homes,  was  already  arising. 
In  the  last  year  of  the  four  over  which  our  record  ex- 
tends fully  three  hundred  and  sixty-two  thousand 
pounds  sterling  ($1,800,000)  was  advanced  for  the 
building  of  such  homes  in  the  outskirts  of  the  various 
cities  in  the  country  to  1,854  workers.  On  the  whole, 
therefore,  the  result  of  this  particular  extension  of  the 
principle  of  State  Socialism  has  been  that  within  four 
years,  four  thousand  two  hundred  and  fifty-three  work- 
ers have  obtained  decent  homes  of  their  own,  by  the 
help  of  the  community  as  a  whole.  The  homes  that 
have  been  built  are  in  almost  all  cases  occupied  by  peo- 
ple engaged  in  some  kind  of  manual  labour  —  generally 
artisans  of  some  kind  —  and  the  houses,   which  are 


OWNERSHIP  OF  MINOR  UTILITIES     225 

erected  on  plans  approved,  and  indeed  usually  supplied, 
free  of  charge,  by  the  Board,  are  neat  cottages  that  have 
been  built  at  a  cost  of  about  twelve  hundred  and  fifty 
doUars  (a  little  more  than  two  hundred  and  fifty 
pounds).  During  these  four  years  the  country  has  in- 
vested in  this  way  fully  $5,000,000  (one  million  and 
seventy-four  thousand  pounds),  and  up  to  the  end  of 
the  fourth  year  the  payment  on  account  of  interest  and 
sinking  fund,  had  been  nearly  fifty-two  thousand 
pounds  ($250,000). 


CHAPTER  VI 

PEOTECTIVE  STATE  SOCIALISM 

The  economic  system  adopted  in  Kew  Zealand,  to 
whicli  we  have  given  the  name  of  State  Socialism  in 
this  book,  involves  the  control,  and  even  the  active  man- 
agement by  the  people's  representatives,  of  a  good  many 
things  that  under  other  systems  of  social  and  political 
economy  have  been  left  in  the  hands  of  individuals  or 
corporations  for  their  own  profit.  The  system  rests  on 
the  conviction,  founded  on  universal  experience,  that 
human  selfishness  which  aims  at  private  advantage,  can 
never  safely  be  entrusted  with  the  control  of  many 
things  which  civilisation  has  rendered  essential  to  the 
well-being  of  a  large  majority  of  any  community. 

The  services  that  have  acquired  the  name  of  Public 
Utilities  in  America  have  been  increasingly  recognised 
in  all  civilised  countries  during  the  last  fifty  years  as 
belonging  to  this  class.  In  some  countries  —  the  op- 
position to  such  a  recognition  by  legislation  has  been 
stronger  than  in  others;  it  is,  however,  impossible  to 
deny  that  in  every  civilised  and  popularly  governed 
country  this  conviction  has  grown  stronger  year  by  year. 
In  America,  it  is  true,  the  opposition  has  so  far  pre- 
vailed that  only  the  Utilities  of  the  Postal  service  and 
the  water  supply  of  cities,  have  as  yet  been  generally; 

226 


PROTECTIVE  STATE  SOCIALISM      227 

recognised  as  too  important  to  the  well-being  of  the  peo- 
ple to  he  left  in  private  hands.  In  England,  however, 
the  Electric  Telegraph  system  has  been  added,  while  in 
many  of  the  larger  cities  both  lighting  and  street  rail- 
ways have  been  taken  charge  of  by  the  Municipal 
authorities,  with  marked  success  and  advantage  to  the 
people.  In  many  European  countries  the  railways  are 
owned  and  operated  by  the  Government,  and  are,  at 
least  nominally  operated  for  the  people. 

In  this  way  the  principle  of  Public  Ownership  of 
Utilities  has  been  tested  and  accepted  by  many  civilised 
nations,  and  experience  has  shown  more  or  less  satis- 
factorily, according  to  the  conditions  of  Government  in 
each  country,  that  there  is  no  essential  difficulty  in  the 
way  of  the  services  being  well  and  cheaply  rendered. 
In  JSTew  Zealand,  experiments  in  this  direction  have  been 
made  on  a  wider  scale  than  elsewhere,  and  have  em- 
braced many  other  Utilities  that  as  yet  have  not  been 
generally  recognised  elsewhere  as  belonging  to  the  class. 
With  these  we  have  dealt  to  some  extent  in  the  preced- 
ing chapter.  There  is,  however,  a  class  of  Utilities,  if 
the  name  can  be  applied  to  services  that  are  mainly  pro- 
tective in  their  character,  that  are  already  presenting 
themselves  as  serious  problems  in  most  countries  of  ad- 
vanced civilisation.  The  war  that  is  now  being  carried 
on  in  America  between  the  Trusts  and  the  Public  in- 
terests probably  represents  this  problem  in  its  most  con- 
crete form,  but  it  is  one  that  is  making  itself  felt  in  every 
country  in  which  the  commercial  spirit  of  the  age  has 
made  any  considerable  progress. 

Objection  may,  of  course,  be  taken  to  the  name  of 


228     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

war  as  applied  to  the  effort  of  commercialism  to  con- 
centrate  in  the  hands  of  a  small  class  the  power  to  dic- 
tate prices  of  commodities  that  have  become  necessaries 
to  the  Public  in  the  way  that  suits  best  the  profit  of  the 
Trusts.  It  is  well,  however,  to  face  such  questions 
plainly  and  it  may  be  regarded  as  a  healthy  sign  of  the 
times  that  the  jDroblem  is  being  dealt  with  even  in 
America  to-day  from  this  point  of  view.  It  is  perhaps 
too  early  in  the  campaign  to  express  any  strong  opinion 
as  to  the  steps  tliat  have  been  and  are  still  being  taken 
in  America  to  ensure  victory  to  the  people  in  the  strug- 
gle; it  may  be  sufficient  to  point  out  that  the  strategy 
employed  with  this  object  in  New  Zealand  is  at  once 
simpler  and  more  efficient  than  anything  yet  tried  in 
other  parts  of  the  world  to  meet  the  difficulty  and  pro- 
tect the  people. 

The  scale  on  which  problems  of  this  kind  can  arise 
in  a  country  like  New  Zealand  must  be  small  as  com- 
pared with  America.  The  supply  of  anything  needed 
by  one  million  people  must  be  limited  compared  with 
that  required  for  ninety  millions,  and  this  difference 
may  very  easily  become  misleading  to  inquirers.  A  na^ 
tion  of  little  more  than  one  million  people  offers  much 
less  inducement  than  one  of  ninety  millions  to  such  a 
struggle  for  commercial  supremacy  of  a  small  class 
over  the  rest  of  the  nation.  There  is,  of  course,  less 
to  excite  cupidity  in  the  smaller  country  because  the  re- 
wards of  success  must  be  smaller.  The  important 
point  to  be  noticed  is,  however,  that  in  every  other  re- 
spect they  are  the  same.  The  scale  is,  after  all,  an 
accident;  it  is  the  principle  involved,  and  the  result  of 


PKOTECTTVE  STATE  SOCIALISM      229 

its  operation  on  the  well-being  of  the  people  whether 
numbering  one  million  or  ninety  that  is  important. 

The  commercial  policy  of  "  cornering "  anything 
needed  by  the  many  is  no  new  policy;  it  is  in  fact  as 
old  as  the  first  appearance  of  the  commercial  spirit  in 
the  earliest  stages  of  civilisation.  It  matters  little  or 
nothing  what  the  thing  is  that  is  "  cornered,"  as  long 
as  it  is  something  needed  by  the  mass  of  a  people,  and 
supi^lied  by  a  small  class.  It  may  be  wheat,  as  in  Chi- 
cago to-day,  or  in  Egypt  thirty-six  centuries  ago ;  it  may 
be  the  coals,  or  the  mineral  oil  required  to  meet  the 
needs  of  a  modern  people;  or  it  may  be  the  insurance 
against  accidents,  or  to  provide  for  a  family  in  case 
of  death.  These,  and  many  more  things  than  these, 
present  themselves  as  temptations  to  those  who  see  in  the 
necessities  of  others  little  beyond  the  selfish  opportunity 
for  themselves.  The  problem  is  one  which  arises  in 
every  part  of  the  civilised  world  to-day:  as  really  in  a 
small  country  as  a  large  one  —  among  a  nation  of  a 
million  inhabitants  as  in  one  of  ninety  millions.  It  is 
not  remarkable,  therefore,  that  the  problem  has  already 
made  its  appearance  in  ISTew  Zealand,  or  that,  in  view 
of  the  evils  that  have  sprung  from  it  in  older  and  larger 
communities,  it  was  considered  necessary  to  deal  wdth 
it. 

Insurance  against  future  disasters  at  the  cost  of 
some  present  self-denial  and  effort  is  one  of  the  most 
characteristic  additions  which  our  modern  civilisation 
has  made  to  the  Utilities  of  nations.  At  first  sight  it 
might  appear  to  be  one  of  the  least  likely  of  all  to  be 
made  the  subject  of  a  system  of  plundering  the  public 


230      SOCIAL  WELFAEE  m  NEW  ZEALAND 

for  the  benefit  of  a  small  class  of  capitalists;  yet  the 
fear  that  such  an  attempt  was  about  to  be  made  was  the 
cause  that  led  the  Parliament  of  New  Zealand  to  take 
the  step  of  offering  to  supply  the  people  with  a  na- 
tional insurance,  applying  first  to  life,  and  afterwards 
in  succession  to  accidents  and  fires.  In  each  case  the 
object  aimed  at  by  the  New  Zealand  legislators  was  the 
protection  of  the  people;  and  in  each  case  the  object 
w^as  successfully  attained.  There  can  be  no  question 
that  the  plan  adopted  in  New  Zealand  has  been  success- 
ful there,  and  little  or  none  that  it  would  answer  the 
same  purpose  if  applied  on  the  larger  scale  necessary 
to  meet  the  case  of  older  and  more  populous  countries. 
The  instance  of  the  establishment  of  a  Fire  Insur- 
ance Department  as  an  extension,  of  the  insurance  de- 
partment of  the  New  Zealand  Government  may  serve 
as  an  illustration:  in  that  case  there  was  a  combination 
of  the  Insurance  companies  —  some  of  them  English 
and  some  New  Zealand  in  origin  —  that  were  doing 
business  in  the  country  to  raise  the  premium  rates  for 
insurance  against  fire.  The  excuse  for  the  proposed  ad- 
vance in  rates  was  that  in  cities  a  much  larger  pro- 
portion of  the  buildings  were  of  wood,  and  therefore 
more  inflammable  than  in  England,  where  the  rates  had 
been  originally  fixed,  and  as  there  had  lately  been 
several  extensive  fires  the  companies  were  confident 
they  would  meet  with  little  opposition  from  the  public. 
The  Government,  however,  made  an  inquiry  into  the 
question,  and  having  come  to  the  conclusion  that  the 
rates  charged  were  sufficient  to  cover  the  risk  run  by 
the  insuring  companies,  they  offered  to  insure  the  peo- 


PEOTECTIVE  STATE  SOCIALISM      231 

pie  against  fire  at  the  rates  that  had  been  in  force  up 
to  the  time  of  the  agreement  between  the  Companies. 

It  was  not  with  the  object  of  becoming  the  Eire 
Insurance  Company  of  New  Zealand,  any  more  than  it 
had  been  that  of  monopolising  the  business  of  Life  or 
of  Accident  assurance,  that  the  Government  obtained 
the  authority  of  Parliament  to  extend  the  departmental 
insurance  business  to  fire  risks,  but  merely  for  the  pro- 
tection of  the  people  from  charges  that  were  excessive. 
This  was  fully  understood  by  the  associated  companies, 
and  it  was  only  a  short  time  before  they  reconsidered  the 
question,  and  came  to  the  conclusion  that  the  rates  for- 
merly charged  would  pay  them  better  than  the  sacri- 
fice of  the  business  to  a  Government  Department.  No 
efforts  have  since  then  been  made  by  the  Department  to 
secure  a  monopoly  of  the  business,  or  to  deprive  the 
Companies  carrying  on  legitimate  business  of  the  pub- 
lic patronage;  the  dej)artment  of  State  insurance 
against  fire,  however,  remains  at  every  centre  of  popu- 
lation, and  is  at  once  a  warning  to  the  companies,  and 
a  security  to  the  people.  New  Zealand  is  as  yet  a  coun- 
try of  wooden  houses,  and  except  in  the  central  parts 
of  the  larger  cities  brick,  stone,  or  cement  buildings  are 
comparatively  rare;  in  spite  of  this  insurance  against 
fires,  which  is  almost  universal,  is  secured  by  its  people 
on  terms  that  compare  very  favourably  with  those  that 
prevail  in  America  or  England, 

The  circumstances  under  which  the  New  Zealand 
Government  interfered  with  Corporate  enterprise  in  the 
matter  of  coal  production  and  distribution  were  very 
similar  to  those  under  which  it  instituted  a  Department 


232     SOCIAL  WELFAKE  IN"  NEW  ZEALAND 

of  Eire  Insurance.  As  the  railroads  of  the  country  had 
for  a  good  many  years  formed  an  important  department 
of  the  administrative  work  of  the  Government  it  was 
only  natural  that  the  advantage  of  obtaining  a  supply 
of  coals  from  mines  situated  on  the  public  lands  should 
have  occurred  to  the  railroad  managers,  as  in  this  way, 
it  was  believed,  fuel  could  be  obtained  more  cheaply, 
while  the  supply  could  be  relied  on  more  certainly  than 
by  any  system  of  dealing  with  mining  companies  either 
in  New  Zealand  or  NTew  South  Wales.  It  was  found 
that  the  Government  coal  mines  were  a  success  for  the 
purpose  intended,  and  for  a  good  many  years  they  were 
used  for  no  other.  The  occurrence  of  one  of  the  strikes 
of  the  coal-miners  of  N^ew  South  Wales,  however,  was 
the  means  of  raising  a  new  issue,  and  one  that  affected 
the  people  of  N^ew  Zealand  directly.  As  long  as  the 
NTewcastle  coals  of  Australia  could  be  procured  at  the 
prices  that  generally  prevailed  there  was  a  check  on 
the  prices  that  could  be  obtained  by  the  coal-mining 
corporations  of  N^ew  Zealand,  and  the  people  could  get 
fuel  on  reasonable  terms.  As  soon  as  it  became  certain 
that  Australian  coal  could  not  be  obtained  in  quanti- 
ties, or  at  prices,  to  encourage  its  importation  to  New 
Zealand  the  coal  corporations  saw  their  opportunity,  and 
prepared  in  New  Zealand,  as  they  would  have  done  in 
America,  to  take  advantage  of  it.  In  doing  this,  how- 
ever, they  had  not  reckoned  sufficiently  with  the  temper 
either  of  the  people  or  the  Government.  Till  then  the 
Government  coal  mines  had  existed  for  Government  pur- 
poses only,  and  the  Executive  were  not  authorised  to 


PEOTECTIVE  STATE  SOCIALISM      233 

use  them  for  any  other :  when  the  well-being  of  the  peo- 
ple and  their  industries  seemed  to  be  threatened,  for 
the  profit  of  a  few  Corporations,  as  it  has  been  so  often, 
in  America,  the  Government  at  once  appealed  to  the 
Parliament  for  authority  to  protect  the  people  in  the 
simplest  and  most  straightforward  way  possible.  From 
the  New  Zealand  point  of  view  the  coal  mines  of  the 
country  were  the  people's  coal  mines,  and  the  people 
were  entitled  to  obtain  coals  on  fair  terms. 

The  result  was,  as  might  have  been  expected,  the  de- 
feat of  the  attempt  to  take  advantage  of  the  people's 
needs  for  the  corporation's  profit.  It  required  no 
elaborate  legislation,  as  in  America,  where  a  similar 
problem  has  taxed  the  energies  of  Courts  and  has  been 
wholly  unsettled  in  twenty  years,  during  which  time 
the  people  have  been  robbed,  and  the  corporations  en- 
riched. The  old  principle  that  free  competition  was 
the  natural  cure  for  attempted  monopoly,  with  all  its 
attendant  evils,  was  applied  to  the  attempted  Coal 
Trust  of  New  Zealand,  by  the  people,  through  their  own 
Government,  supplying  the  competitor.  It  was  true 
the  Government  mines  could  not  supply  enough  coals  to 
meet  the  needs  of  the  country  at  once,  but  the  Corpora- 
tions were  shrewd  enough  to  see  that  it  would  be  fatal 
to  their  future  business  if  they  compelled  the  people's 
Government  to  extend  its  operations  sufiiciently  to  sup- 
ply the  whole  of  the  people's  needs.  If  new  mines 
could  not  be  opened  quickly  enough,  the  Parliament 
could  take  the  mines,  as  it  had  before  taken  the  land 
required  for  the  people's  needs,  and  the  knowledge  of 


234     SOCIAL  WELFARE  IN  NEW  ZEALAND 

this  fact  was  sufficient  to  bring  the  corporations  to 
their  senses,  and  to  secure  to  the  people  the  fuel  thej 
required  on  reasonable  terms. 

As  in  the  case  of  the  Government  Insurance  Depart- 
ments for  protection  against  accidents  and  fires,  so  in 
that  of  providing  the  fuel  required  for  the  grov^ing 
industries  of  the  people,  no  attempt  has  been  made  to 
institute  an  injurious  competition  with  the  Mining 
Corporations  in  New  Zealand.  The  object  lesson  pre- 
sented bj  the  establishment  of  coal  depots  for  the  sup- 
ply of  the  people,  and  their  protection  against  imposi- 
tion, at  the  chief  centres  of  population  was  sufficient. 
The  depots  have  not  been  multiplied,  but  they  remain 
as  a  warning,  and  the  warning  has  been  effectual. 
There  have  been  strikes  on  the  coal  fields  of  New  South 
Wales  since  then  that  have  shut  off  the  supply  for  ex- 
port during  months,  and  seriously  injured  the  industries 
of  Australia  for  the  time:  no  attempt  has  been  made 
by  the  coal-mining  corporations  of  New  Zealand  to 
repeat  the  experiment  of  raising  prices  in  the  island 
Dominion,  and  no  injury  has  thus  been  done  to  the 
rapidly  growing  industries  of  the  people. 

It  may  seem  to  some  readers  almost  a  misuse  of 
terms  to  class  the  Legislation  of  New  England  that  has 
for  its  object  the  relief  of  its  people  from  unnecessarily 
heavy  interest  on  the  capital  required  for  carrying  on 
successfully  the  business  of  a  large  proportion  of  the  peo- 
ple as  "  protective,"  In  doing  so,  however,  the  writer 
of  this  book  believes  he  is  fairly  representing  the 
underlying  principle  of  what  he  has  termed  the  State 


PEOTECTIVE  STATE  SOCIALISM      235 

Socialism  of  ]^ew  Zealand.  The  gradual  evolution  of 
civilised  society,  has,  like  all  other  evolutions,  been  one 
of  struggle,  in  which  the  highly  endowed  few  have  been, 
more  or  less  consciously,  arrayed  in  an  age-long  strug- 
gle against  the  little  endowed  multitudes  of  their  fel- 
lows. In  this  struggle  they  have  by  various  means  — 
some  of  them,  it  may  be,  what  we  may  call  fair,  others 
certainly  cruel  and  unfair  —  accumulated  the  exchange- 
able wealth  which  is  kno^vn  as  capital.  Of  tliis  capital 
they  have  naturally  tried  to  make  the  greatest  possible 
profit,  with  regard  only  to  their  own  advantage,  and 
with  little  or  no  reference  to  the  advantage  of  those  to 
whom  it  was  lent.  This  policy  of  securing  the  highest 
returns  for  accumulated  capital  has  naturally  reached 
its  greatest  development  in  this  age  of  commercialism, 
and  it  is  no  exaggeration  to  say  that  it  is  an  almost  uni- 
versally accepted  economic  doctrine  of  our  time  that 
the  man  possessed  of  capital  is  more  or  less  a  fool  who 
parts  with  it  for  less  than  the  highest  return  in  interest 
that  can  be  safely  obtained  for  its  use.  Thus  in  every 
country  of  the  civilised  world  to-day  society  may  fairly 
be  said  to  be  divided  into  the  two  contending  parties  of 
those  who  have  capital,  for  which  they  seek  the  greatest 
possible  return,  and  those  who  have  little  or  no  capital, 
but  are  eager  to  obtain  and  to  use  it,  on  the  best  pos- 
sible conditions.  There  are  fortunately,  however,  two 
classes  of  capitalists :  the  one  bent  on  obtaining  the  high- 
est return  for  what  he  has  accumulated,  the  other  more 
eager  for  security  than  for  a  large  present  interest. 
The  first  class  lends  to  individuals  or  to  companies  en- 


236     SOCIAL  WELFARE  IN"  NEW  ZEALAND 

gaged  in  trade;  the  other  prefers  to  accept  small  in- 
terest from  Communities  or  nations,  with  the  prac- 
tical certainty  of  receiving  regular  returns. 

The  State  Socialism  of  New  Zealand  has  proceeded 
on  a  policy  of  using  the  credit,  as  well  as  the  powers 
of  the  nation  for  the  protection  of  its  people  from  the 
exorbitant  demands  of  the  class  that  uses  capital  com- 
mercially, by  appealing  to  the  other  class  of  capitalists 
that  looks  for  safe  returns  rather  than  exorbitant  in- 
terest. This  policy  has  been  a  protective  one  in  the 
truest  sense  of  the  word  in  New  Zealand,  and  its  re- 
sults have  been  remarkable  for  their  success.  It  is  not 
as  yet  many  years  since  the  policy  was  widely  applied, 
indeed,  but  even  in  the  few  years  that  have  passed  it 
has  done  much  in  that  country  to  remove  the  barriers 
that  elsewhere  stand,  as  they  have  stood  for  ages,  be- 
tween the  well-to-do  classes  and  the  poor.  It  has  been 
the  boast  of  America  for  more  than  half  a  century  that 
it  is  a  country  —  perhaps  the  only  country  —  in  which 
it  is  possible  for  the  poor  boy  to  become  a  great  mil- 
lionaire ;  it  may  well  become  the  boast  of  New  Zea- 
land that  hers  is  the  only  country  in  which  every  poor 
boy,  if  he  is  only  persevering  and  steady,  may  without 
special  talents  or  unprincipled  ambition,  become  not  a 
millionaire,  indeed,  but  that  which  is  better  both  for 
himself  and  his  country  —  a  well-to-do  and  self-respect- 
ing citizen. 

New  Zealand's  policy  in  the  past  twenty  years  may 
claim  the  sympathy  and  approval  of  lovers  of  their  kind 
in  every  country,  on  the  gi'ound  that  it  has  kept  steadily 
before  it  the  two  great  principles  of  justice  —  equal  jus- 


PEOTECTIVE  STATE  SOCIALISM      237 

tice  —  to  all  its  people,  and  the  recognition  of  a  real 
brotherhood  between  all  classes:  it  can  do  more  than 
this,  however,  to-day;  it  can  claim  recognition  as  the 
first  illustration  on  a  national  scale  of  the  long  neg- 
lected economic  truth  that  justice  and  brotherly  treat- 
ment to  all  —  in  other  words  national  righteousness  — ■ 
means  prosperity  —  such  a  prosperity  as  can  be  reached 
in  no  other  way.  The  people  of  ISTew  Zealand  —  iso- 
lated from  the  markets  of  the  world  by  distances  greater 
than  any  other  country  inhabited  by  civilised  men; 
possessed  of  no  remarkable  natural  resources  of  mineral 
wealth  either  to  attract  population  or  capital  to  their 
shores  —  are  to-day,  it  may  be  said  without  the  small- 
est exaggeration,  the  most  contented,  the  most  law- 
abiding,  and  the  most  prosperous  Community  in  the 
world. 

In  the  earlier  chapters  of  this  book  the  writer  has 
attempted  to  trace  the  steps  by  which  this  success  has 
been  reached.  He  has  stated  the  actual  position  of 
things  in  ISTew  Zealand  twenty  years  ago  on  the  au- 
thority of  the  official  statements  laid  that  year  before  the 
Parliament,  and  regarded  at  the  time  as  wholly  satis- 
factory: he  has  compared  this  state  of  things  with  that 
which  exists  to-day,  on  the  same  authority  without  ex- 
aggeration or  misrepresentation  either  of  facts  or 
figures ;  it  remains  only  for  him  to  present  the  problem 
which  arises  from  these  facts,  and  to  suggest  what  ap- 
pears to  be  its  only  reasonable  solution.  This  he  pro- 
poses to  do  in  the  next  and  final  chapter  of  this  book, 
before  proceeding  to  deal  with  the  question  of  the  prob- 
lem in  its  relation  to  other  and  older  countries  than  New 


238     SOCIAL  WELFAEE  m  l^EW  ZEALAND 

Zealand,  and  to  other  and  more  numerous  populations 
that  have  not  as  yet  had  the  opportunities  for  national 
and  social  well-being  that  have  done  so  much  for  her 
people. 


BOOK  IV 
WHAT  IT  MAY  MEAI^  FOE  THE  WORLD 


CHAPTEK  I 

THE  LESSON 

What  is  the  true  significance  of  the  object  lesson  of- 
fered by  New  Zealand  for  the  consideration  of  the  rest 
of  the  world  ?  Before  we  go  farther  it  may  be  well  to 
arrive,  if  possible,  at  a  clear  understanding  on  this 
point. 

Two  features,  both  startling  in  their  quality  of 
unexpectedness,  stand  out  prominently  in  the  study 
already  made  of  the  twenty  years'  policy  of  the  Domin- 
ion of  the  South  Pacific.  The  first,  and  as  the  writer 
believes  the  most  important  of  these,  is  the  successful 
dealing  by  its  means  with  many  problems  that  elsewhere 
remain  almost  untouched,  involving  the  well-being  of  the 
great  majority  of  the  people.  The  second  is  the  un- 
questionable fact  that  the  policy,  which  was  condemned 
as  inevitably  leading  to  social  degradation  and  financial 
ruin,  has  proved  a  great  success. 

On  every  side,  and  in  every  civilised  country  there 
are  evidences  of  social  unrest,  so  marked,  and  in  most 
countries  so  threatening,  that  thoughtful  observers  are 
asking  themselves  the  question  —  what  next?  The 
conditions  that  have  prevailed  so  long  that  even  thought- 
ful reasoners  on  such  subjects  have  learned  to  accept 
them  as  inevitable,  even  if  puzzling  and  distressing, 

241 


242      SOCIAL  WELFARE  IN  NEW  ZEALAND 

seem  no  longer  to  find  general  acceptance.  The  social 
order  that  has  appeared  to  those  who  occupied  the  better 
positions,  at  any  rate,  so  satisfactory  that  its  establish- 
ment might  fairly  be  attributed  to  the  will  of  a  good 
Creator,  is  everywhere  publicly  discredited,  and  is  ap- 
parently tottering  to  its  downfall.  The  modem  substi- 
tute for  the  old  political  and  social  ideals  of  the  Mid- 
dle Ages  —  the  age  of  commercialism,  in  which  the 
spoils  of  victory  in  the  markets  of  the  world  are  to  go 
to  the  most  able  trader,  and  the  most  unscrupulous 
financier, —  has  utterly  failed  to  give  satisfaction  or 
well-being  to  the  masses  in  any  country;  and  it  is  no 
exaggeration  to  say  that  it  has  given  rise  to  an  agita- 
tion in  most  that  threatens  revolution  and  collapse  at 
no  distant  period. 

The  great  social  problem,  therefore,  of  our  age  can 
hardly  be  set  aside,  or  treated  lightly  by  any  reasonable 
citizen  of  a  civilised  country  to-day.  Conditions,  it  is 
true,  differ  to  a  certain  extent,  and  with  these  there 
arises  a  difference  more  or  less  important  in  the  amount 
of  the  unrest  that  exists,  and  the  indications  by  which 
it  may  be  recognised :  in  every  case,  however,  the  es- 
sential and  underlying  causes  of  the  agitation  are  the 
same.  In  every  country  where  civilisation  has  made 
considerable  progress  the  general  intelligence  of  the 
great  majority  of  the  people  has  developed  within  the 
last  generation  as  it  had  not  developed  in  many  cen- 
turies before.  This  development  has  not  destroyed  the 
appreciation  of  the  natural  advantages  by  which  in  all 
ages  of  history  one  man  has  been  able  to  excel  his 
neighbours;  it  has,  however,  weakened  to  a  greater  ex- 


THE  LESSON  243 

tent  than  ever  before,  the  almost  superstitious  estimate 
of  such  powers,  independently  of  the  uses  to  which  they 
were  applied.  The  reverence,  which  has  for  ages  at- 
tached itself  in  Germany  to  the  class  of  the  old  no- 
bility, and  in  England  in  a  less  degree  to  the  landed 
gentry,  with  or  without  titles,  is  passing  away,  and 
will  soon,  it  may  safely  be  said,  be  gone.  With  that 
reverence  has  already  gone  to  a  great  extent  the  respect 
for  the  order  of  society  which  it  expressed.  In  Amer- 
ica, it  may  be  said  such  conditions  have  not  existed; 
and  this  is,  at  least  nominally  true.  In  America,  how- 
ever, the  underlying  principle  of  these  class  distinctions 
has  been  as  fully  developed  as  elsewhere.  There  has 
been  no  hereditary  class  of  nobles,  as  in  Germany,  and 
no  class  of  landed  gentry,  as  in  England;  there  has, 
however,  been,  and  there  is  to-day,  a  new  class  of  nobles 
and  gentry  —  the  class  of  the  commercial  magnate,  and 
the  political  Boss, —  which  have  inherited  nearly  all  the 
bad  qualities  of  the  distinguished  classes  of  older  coun- 
tries, and  have  added  to  them  a  few  new  ones  on  their 
own  account.  Instead  of  the  quality  of  so-called  noble 
or  gentle  blood,  the  new  American  classes  have  prided 
themselves  on  the  possession  of  larger  hoards  of  wealth, 
gained  at  the  expense  of  their  neighbours,  and  a  greater 
talent  for  increasing  their  riches,  and  the  power  which 
those  riches  give  them,  than  is  possessed  by  any  but  a 
few  of  their  fellow  citizens. 

In  one  form  or  another  there  exists,  therefore,  in 
each  of  the  world's  great  civilised  countries  that  pride 
themselves  to-day  on  the  vast  political  and  social  ad- 
vancement of  their  people,  as  compared  with  the  gen- 


244     SOCIAL  WELFARE  m  NEW  ZEALAND 

erations  before  tbem,  a  survival  of  tbe  same  defects 
that  have,  in  one  form  or  other,  distinguished  society 
since  organised  communities  began.  The  power,  mental 
or  physical,  of  one  class  to  secure  more  than  its  fair 
share  from  other  classes  has  always  existed,  and  has 
always  been  exercised  by  the  few  to  the  injury  of  the 
many.  This  is  equally  true  of  the  noble  who  lives  on 
the  labour  of  the  people  who  live  on  his  hereditary  es- 
tates, and  of  the  multi-millionaire  who  wallows  in 
riches  which  he  has  secured  by  his  ability  to  seize  on 
something  needed  by  his  fellow  citizens,  and  force  them 
to  pay  for  it  at  a  price  far  beyond  what  it  costs.  And 
in  every  country  —  in  Germany,  England,  and  by  no 
means  least  in  America,  the  people  have  at  last  found 
it  out.  They  have  done  this;  they  have  done  more 
than  this.  They  have  been  learning  the  truth  that  it 
has  been  their  work,  and  the  work  of  their  ancestors, 
that  has  earned  the  money  on  which  the  nobles  and 
landed  gentry  of  the  past  have  lived  so  comfortably,  and 
that  it  is  their  hard-earned  wages  that  have  gone  to 
make  up  the  vast  fortunes  of  the  millionaires  of  to- 
day. They  have  also  learned,  or  are  in  the  way  of  learn- 
ing, the  other  truth  that  it  rests  with  them  to  alter  the 
social  system  that  has  lasted  so  long,  and  in  many  re- 
spects worked  so  injuriously. 

This  is  the  problem  of  the  twentieth  century  in  its 
two-fold  aspect,  and  there  can  be  no  doubt  that  it  is  a 
serious  one  —  perhaps  the  most  serious  that  has  yet 
confronted  men  in  their  social  relations.  Not  once  or 
twice,  but  many  times  in  the  history  of  nations,  there 


I 


THE  LESSON  245 

have  been  partial  discoveries  of  the  same  kind  made  bj 
the  people  of  one  country  and  another.  The  down- 
trodden majorities  have  grown  first  impatient  and  at 
last  desperate  at  thought  of  the  needless  luxury  of  the 
few  among  their  people,  and  the  apparently  hopeless 
misery  of  the  many ;  and  at  last  they  have  risen  in  re- 
volt, and  tried,  with  more  or  less  partial  success,  to 
bring  about  a  revolution.  In  the  end  they  have  failed 
in  their  purpose;  not  because  their  purpose  was  wrong 
in  itself,  but  because  they  had  not  the  intelligence  or 
skill  that  were  needed  to  carry  it  out.  Society  —  even 
a  majority  of  the  society  which  we  call  a  nation  — 
shrinks  instinctively  from  violent  changes  in  social  ar- 
rangements, necessarily  accompanied  by  many  evils; 
and  in  every  attempt  at  a  great  social  revolution  of 
which  any  record  has  survived  it  has  been  this  element 
of  violence,  with  its  accompanying  evils,  that  has  in  the 
long  run  given  the  victory  to  the  old  order  of  things. 
The  conviction  that  it  is  better  to  bear  the  evils  they 
have  grown  accustomed  to,  through  long,  even  through 
bitter  experience,  than  to  take  the  risks  that  may  be  in- 
volved in  new  ones,  would  appear  to  be  almost  universal ; 
and  it  is  an  instinct  that  has  assisted  in  the  substantial 
progress  of  organised  society.  It  is,  however,  an  in- 
stinct that  has  its  foundation  in  ignorance.  If  men 
knew  more  clearly  what  it  was  they  wanted  in  the  di- 
rection of  social  change  and  improvement  the  chief 
cause  of  the  failures  of  the  past  w^ould  have  disappeared : 
if  they  were  fully  convinced  that  they  sufficiently  under- 
stood the  les&oms  taught  by  past  failures  to  guide  them 


246     SOCIAL  WELFARE  IN  NEW  ZEALAND 

to  a  future  success,  the  instinctive  fear  of  the  un- 
known would  have  ceased  to  prove  an  unsurmountable 
barrier. 

It  is  at  this  point  that  the  social  problem  of  the 
twentieth  century  differs  from  the  same  problem  as  it 
has  appeared  in  many  centuries,  and  among  many  na- 
tions in  the  past.  In  nearly  every  country  the  last 
half  century  has  witnessed  a  great  awakening.  It  has 
become  a  common-place  to  speak  of  the  Awakening  of 
China,  as  twenty-five  years  ago  we  spoke  of  the  Awaken- 
ing of  Japan ;  and  the  idea  which  the  phrase  repre- 
sented was  in  both  instances  a  true  one.  It  is  equally 
true,  though  the  familiarity  of  the  subject  has  made  it 
less  appreciated,  that  there  has  been  a  great  Awaken- 
ing, which  is  still  going  on,  among  the  civilised  na- 
tions of  Europe  and  America  —  an  awakening  that  is 
quite  as  real,  and  may  well  be  attended  by  quite  as  re- 
markable consequences  to  the  future  of  the  world  as 
anything  that  has  taken  place  in  the  far  eastern  coun- 
tries of  Asia.  In  both  cases  the  awakening  is  an  in- 
tellectual one.  It  may  be  said,  indeed,  that  in  the 
case  of  the  peoples  of  eastern  Asia  the  awakening  has 
been  that  of  a  whole  nation,  while  in  the  countries  of 
the  west  it  is  that  of  a  part  of  the  people:  in  its  im- 
portance, at  any  rate,  and  even  in  many  of  its  results 
the  awakening  will  probably  have  very  similar  results. 
The  awakening  of  the  Far  East  has  been  a  general  awak- 
ening to  new  ideas,  and  a  new  knowledge  of  many 
things:  in  the  West  it  is  also  an  awakening  to  new 
ideals,  and  a  new  intelligence  that  appears  to  make 
those  ideals  things  that  may  and  shoidd  be  attained. 


THE  LESSON  247 

In  the  Ear  East  the  well-being  of  the  vast  majority  of 
the  nation  seems  to  its  people  to  depend  on  greater  free- 
dom, and  more  political  power :  in  the  West  the  question 
is  how  the  freedom  and  the  political  poAvers  they  have 
long  possessed  may  be  used  to  secure  the  well-being 
they  are  still  in  need  of. 

It  is  on  this  question  that  past  experience  has  but  lit- 
tle to  say.  What  history  can  tell  us  of  the  past  is  but 
a  melancholy  record  of  cruel  conditions,  affecting  the 
great  majority  of  every  nation;  and  of  spasmodic  at- 
tempts on  the  part  of  the  sufferers  to  shake  off  those 
conditions  by  some  great  and  violent  revolution.  The 
record  of  miserable  conditions,  under  which  the  many 
have  been  sacrificed  to  the  few  is  hardly  more  emphatic 
than  that  which  tells  of  the  failure  of  the  various  up- 
heavals by  which  the  majority  has  endeavoured  to  shake 
them  off.  A  few  philosophers  have  dreamed  of  a  bet- 
ter state  of  things ;  but  as  yet  mankind  has  failed  to  real- 
ise any  near  approach  to  them  in  the  actual  life  of 
nations.  It  has  always  been  the  same  sad  tale  of  the 
few  that  gained  what  they  desired  at  the  expense  of  the 
many  who  had  to  content  themselves  as  best  they  might 
with  the  crumbs  that  fell  from  the  overloaded  tables 
of  the  others. 

It  is  here  that  the  social  theories  of  philosophers 
have  been  found  wanting,  and  the  beautiful  dreams  of 
the  socialist  teachers  have  found  themselves  confronted 
by  an  apparently  insurmountable  wall  of  stem  facts. 
In  such  a  case  the  object  lesson  which  can  alone  be 
of  practical  use  must  be  one  of  experience.  It  must  be 
one  that  takes  society  as  it  is,  and  shows  not  only  what 


248      SOCIAL  WELFAEE  IN  NEW  ZEALAND 

it  might  be  made,  but  how  the  making  can  be  done. 
The  scale  on  which  the  object  lesson  is  given  must  of 
course  be  large  enough  to  display  the  main  features  both 
of  what  is  to  be  amended,  and  what  it  is  to  become 
when  the  amendment  is  effected;  but  it  need  be  on  no 
larger  scale  than  this.  It  must  show  a  human  society  in 
all  essentials  like  other  national  communities ;  and  it 
must  show  the  processes  by  which  such  a  community  can 
be  taught  successfully  to  shake  off  the  characteristics 
that  still  degrade  it.  It  may  easily  be  imagined  that 
such  an  object  lesson  as  this  could  not  readily  be  found: 
it  is  almost  unthinkable  that  it  should  be  found  in 
absolute  perfection.  This,  however,  is  not  necessary, 
and  it  may  even  be  impossible.  As  the  conditions  of 
no  two  countries  are  alike  in  all  respects  the  social, 
political,  and  economic  object-lesson  that  appeals  most 
perfectly  to  one  must  necessarily  fail,  at  least  compara- 
tively, in  its  appeal  to  the  other. 

This  is  the  natural  answer  to  the  common  argument 
that  may  be  heard  any  day  in  America  from  those  who 
are  ready  to  express  admiration  for  the  experiments 
made  in  New  Zealand,  and  yet  complain  that  the  ex- 
ample of  New  Zealand  can  be  of  little  service  to  a 
country  like  their  0"\vn.  It  is  true  the  conditions  of 
America  differ  from  those  of  New  Zealand  in  many 
ways,  and  the  exact  reproduction  of  these  conditions  in 
the  Pacific  island  Dominion  would  not  have  been  pos- 
sible, even  if  it  had  been  desirable.  The  scale  on  which 
those  conditions  exist  in  America  itself  forbids  the  idea, 
but  it  by  no  means  destroys  the  practical  value  of  the 
lessdns  that  may  be  learned.     America,  more  perhaps 


THE  LESSON  249 

than  any  otter  of  the  greater  countries  of  western  civili- 
sation to-day,  has,  if  her  people  will  only  see  it,  the 
advantage  of  being  able  to  understand  and  profit  by  the 
lesson  from  New  Zealand.  At  first  sight,  indeed,  this 
may  appear  unlikely,  but  a  little  consideration  will  serve 
to  show  that  it  is  true. 

In  the  case  of  Germany,  for  instance,  the  conditions 
of  the  people  political,  social,  and  economic,  are  in  many 
respects  unlike  those  of  America,  and  in  every  one  of 
these  they  are  still  more  unlike  those  of  New  Zealand 
at  the  time  when  her  experiments  in  State  Socialism 
were  begun.  They  present  the  features  of  a  nation,  oc- 
cupying a  country  whose  lands  are  hardly  more  than 
sufiicient  to  support  its  people  in  decent  comfort,  and 
whose  lands  have  for  centuries  been  taken  from  the 
people  by  a  small  class  of  the  community  whose  monop- 
oly has  become  almost  sacred  in  the  opinion  of  the 
inhabitants  by  long  custom  and  usage.  To  take  these 
lands  for  the  people's  use  and  ownership,  as  was  done 
in  New  Zealand,  would  seem  to  the  people  of  Ger- 
many, and  certainly  not  less  to  the  class  of  the  German 
nobility,  revolutionary  in  the  highest  degree  —  a  policy 
to  be  resisted  by  force,  and  probably,  if  need  be,  by 
civil  war. 

In  some  respects  the  case  of  England  is  even  less 
like  that  of  New  Zealand,  and  the  policy  adopted  there 
as  to  the  first  step  of  social  and  economic  reform  would 
be  almost  meaningless  in  a  country  where  the  land  of 
the  country,  if  it  could  be  equally  divided  among  the 
inhabitants,  would  provide  less  than  two  acres  for  each 
of  its  people,  of  which  at  least  a  third  part  would  be 


250      SOCIAL  WELFARE  IN  NEW  ZEALAND 

useless  for  cultivation.  The  fact  that  circumstances 
have,  during  the  last  century  gradually  forced  the  in- 
habitants of  Great  Britain  into  the  position  of  living 
and  working  in  crowded  cities,  while  it  does  not  pre- 
vent her  people  learning  much  from  New  Zealand's  ex- 
perience, makes  it  less  easy  to  do  so  in  a  practical  shape 
than  is  the  case  with  America.  For,  like  New  Zea- 
land, America  is  still  a  new  country.  Large  as  are  the 
numbers  of  her  people  they  are  not  yet  crowded  of 
necessity  into  the  unwholesome  atmosphere  of  great 
cities.  It  is  true  that,  to  a  large  extent,  America  has 
allowed  the  most  valuable  part  of  her  lands  to  be  monop- 
olised by  individuals,  and  still  more  by  corporations 
that  have  made  use  of  it  to  grow  rich  at  the  expense 
of  the  rest  of  her  people;  this,  after  all,  only  places 
her  in  the  position  which  alarmed  the  people  of  New 
Zealand  into  taking  the  first  steps  towards  economic 
reform. 

In  America,  as  in  every  part  of  the  world,  the  land 
is  the  original  source  of  national  wealth,  and  there  is 
still  sufficient  land  in  the  United  States  to  make  its  peo- 
ple, numerous  as  they  are,  wealthy  in  the  only  real 
sense  of  the  word,  if  they  will  only  make  up  their  minds 
to  use  it  reasonably  and  well. 

There  is  a  common  delusion  abroad  that  America 
has  used,  and  is  using  her  vast  heritage  of  public  lands 
both  well  and  wisely;  but  it  is,  after  all,  only  a  delu- 
sion. The  land  of  a  country  is  never  well  used  unless 
it  is  used  so  that  the  greatest  benefit  arises  to  its  people. 
Where  this  is  the  case  the  people  do  not  desert  the  land 
to  take  refuge  in  the  slums  of  great  cities,  but  rather 


THE  LESSON  251 

desert  the  cities  for  the  cleaner,  purer,  and  more  nat- 
ural life  of  the  country.  This  is  part  of  the  object  les- 
son from  New  Zealand ;  and  it  is  one  that  can  be  made 
to  apply  not  less  forcibly  to  America.  Huge  areas  of 
the  public  lands  have  been  handed  over  to  the  railroad 
Corporations,  to  be  dealt  with  in  the  way  that  seemed 
likely  to  yield  the  largest  profits ;  other  areas  have  been 
disposed  of  in  huge  estates  on  the  principle,  which  was 
adopted  in  New  Zealand  thirty  years  ago,  of  waiting  for 
a  rise  in  values  —  a  rise  that  can  only  be  caused  by 
the  needs  of  the  people  who  have  been  deprived  by  the 
policy  pursued  of  their  natural  inheritance.  On  the 
same  principle  the  great  mineral  riches  of  the  country 
have  been  wasted.  The  coal,  the  iron,  the  lead  and 
copper  ores,  and  not  least  the  great  treasure  of  mineral 
oil,  have  been  taken  from  the  people,  to  whom  they  be- 
longed, and  handed  over  to  capitalist  corporations  to  be 
used  as  the  instruments  by  which  the  wealth  that  should 
have  meant  well-being  for  the  nation  flowed  into  the 
already  overloaded  coffers  of  a  class  which  reaped 
power  that  was  generally  badly  used,  and  luxury  that 
was  little  better  than  a  curse  to  themselves  and  their 
children. 

To-day  it  may  be  said,  there  are  many  States  of 
America  in  which  the  land  still  in  the  hands  of  the 
Government  may  be  obtained  on  easy  terms  —  more 
easy,  it  may  be  argued  than  those  that  are  said  to  have 
produced  such  remarkable  results  in  New  Zealand. 
Why  then  are  the  results  so  different  ?  There  may  be 
many  reasons  for  this,  it  is  true,  but  one  at  least  is  evi- 
dent :  the  American  system  lends  itself  directly  to  specu- 


252     SOCIAL  WELFARE  IN"  NEW  ZEALAND 

lation  while  that  of  IN^ew  Zealand  practically  prohibits 
it.  It  is  no  part  of  l^ew  Zealand's  policy  of  State  So- 
cialism to  give  away  the  land  of  the  people  without 
some  security  that  it  shall  be  made  use  of  in  a  way 
that  will  benefit  both  the  nation  that  gives  and  the 
settler  who  receives  it.  The  land  selector  in  New  Zea- 
land is  bound  really  to  live  upon,  and  actually  to  im- 
prove it  to  a  definite  extent  before  he  obtains  any  title : 
he,  or  in  case  of  his  death,  his  family  are  bound  to  do 
both  for  a  good  many  years  before  they  can  obtain  a 
title  that  may  be  transferred  to  any  one  else.  It  is 
not  possible  there  to  take  section  after  section,  keep 
them  for  a  few  years,  and  then  sell  them  to  some  one 
else,  moving  on  to  another  to  go  through  the  same  proc- 
ess. The  policy  of  the  island  Dominion  has  been  to 
encourage,  and  help  the  real  settler  by  every  means  pos- 
sible, and  this  policy  has  been  an  almost  unlimited  suc- 
cess; it  has  never  been  its  policy  to  encourage  land 
speculation  at  the  expense  of  the  nation.  To  the  real 
settler,  who  is  engaged  in  cultivating  and  improving  his 
land  on  the  terms  of  his  perpetual  ease,  and  who  regu- 
larly pays  the  rent  agreed  on  each  year  it  is  safe,  in 
the  public  interest,  to  supply  assistance,  either  in  the 
form  of  seeds  for  his  farm,  and  trees  for  his  orchard, 
or  in  money  to  be  spent  in  buildings  or  fences  on  the 
land,  at  low  rates  of  interest,  guaranteed  by  the  credit 
of  the  whole  community.  This  policy  has  led  in  New 
Zealand  to  good  farming,  and  large  returns  from  the 
land  that  have  increased  year  after  year.  Under  this 
system  of  close  settlement  there  has  been  no  temptation 
to  adopt  the  system  of  scourging  the  land  to  grow  poor 


THE  LESSON"  253 

crops  of  grain,  for  which  no  return  was  made  to  the 
soil,  and  which  impoverishes  the  land  of  the  country, 
while  it  gives  back  a  beggarly  return  for  the  labour  ex- 
pended. 

In  all  these  respects  Xew  Zealand's  twenty  years'  ex- 
perience in  dealing  with  her  lands  forms  an  object-les- 
son that  may  well  be  of  service  to  America.  The  great 
continental  Republic,  misled  by  the  vast  extent  of  its 
landed  estate,  has  treated  this  chief  asset  of  the  coun- 
try's wealth,  as  if  its  future,  and  that  of  the  people 
who  cultivated  it,  might  safely  be  left  to  take  care  of 
itself.  Its  rulers  have  given  away  vast  areas  of  its 
people's  estate  to  corporations,  to  dispose  of  for  their 
own  profit ;  they  have  given  it  to  selectors  on  terms  that 
have  encouraged  speculation,  and  led  to  a  system  of 
farming  which  has  degraded  the  average  production  of 
grain  from  each  acre  to  considerably  less  than  half 
what  is  obtained  from  similar  land  in  Xew  Zealand. 
The  full  meaning  of  this  has  not  yet  been  realised  in 
America,  or  in  Canada,  where  a  similar  land  policy  is 
leading  to  the  same  results ;  but  the  time  cannot  be  dis- 
tant when  it  will  become  evident  to  the  most  thought- 
less in  the  loss  of  wealth  from  the  lands  of  the  country, 
and  the  loss  of  well-being  —  small  enough  even  now  — 
to  that  part  of  the  population  which  continues  to  seek  a 
living  from  its  cultivation. 

ISTor  is  the  value  of  Xew  Zealand's  object  lesson  con- 
fined to  the  policy  that  has  dealt  with  the  lands  of  the 
people  in  America,  or  as  a  consequence,  with  the  well- 
being  of  the  workers  on  the  land.  In  America,  as  in 
England,  Germany,  and  other  European  countries,  the 


254     SOCIAL  WELFARE  IN  NEW  ZEALAND 

people  have  been  deserting  the  country  for  the  cities  for 
the  last  thirty  years  to  an  extent  that  increases  year  by 
year.  Ingenuity  and  enterprise,  genius  and  mechanical 
skill,  have  all  lent  their  assistance  to  render  the  prog- 
ress made  in  the  mechanical  arts  and  industries  more 
attractive  and  more  wonderful  than  in  any  former  age. 
The  consequence  has  been  that  the  leading  feature  of 
the  time,  as  it  affected  social  questions,  has  become  that 
of  associated  industry.  The  age  that  has  arisen  has 
been  one  of  great  riches,  accumulated  in  the  hands  of 
a  small  class,  balanced,  and  as  a  rule  more  than  bal- 
anced, by  the  absence  of  nearly  all  that  makes  for  well- 
being  in  the  vastly  large  class  of  the  workers  and  their 
families.  The  life  of  the  great  cities  has  for  the  great 
majority  become  emphatically  an  unwholesome  life. 
To  the  workers  it  has  been  a  life  of  long  hours  of  labour 
of  a  kind  much  more  exhausting  than  that  which  made 
its  demand  almost  wholly  on  muscular  strength.  It 
has  been  a  life  of  little  relaxation,  and  of  few  healthy 
amusements  for  the  men  and  women,  while  for  the  vast 
majority  of  the  children  it  has  been  even  worse.  It 
would  be  no  easy  task  to  imagine  conditions  of  life  less 
likely  to  produce  a  people  really  worthy  of  liberty,  or 
likely  to  use  really  well  the  liberty  they  enjoy. 

New  Zealand's  object  lesson  has  its  bearing  on  such 
conditions  as  these.  It  has  shown  that  industry  such 
as  prevails  in  the  great  cities  of  to-day  does  not  de- 
mand the  degradation  of  the  workers,  or  the  sacrifice 
of  the  next  generation  of  their  class.  It  has  shown  that 
it  is  possible  to  carry  on,  and  even  rapidly  increase,  the 
mechanical  industries  for  which  the  age  is  so  remark- 


THE  LESSOj^  255 

able,  and  yet  to  secure  for  the  workers  reasonable  rest 
and  enjoyment,  and  for  tbeir  families  conditions  of 
well-being  such  as  have  not  been  dreamed  of  hitherto 
by  the  workers  at  any  great  industrial  centre  in  Amer- 
ica, England,  or  Germany. 


CHAPTER  II 

THE    VALUE   OF    THE   LESSON 

l^ATiONS,  like  individuals,  are  seldom  willing  to  be 
taught  a  lesson,  and  the  unwillingness  is  likely  to  be 
the  greater  where  the  lesson  comes  from  a  community 
that  is  younger  and  smaller  than  itself.  What  has  been 
said  of  the  experiments  made  by  !N^ew  Zealand,  and 
their  resuts  is  certainly  exposed  to  this  disadvantage. 
l^ew  Zealand  is  a  small  country.  It  contains  but  little 
more  than  a  million  people,  and  these  practically  all  of 
one  race;  the  industries  of  the  country  are  compara- 
tively new,  and  limited  both  in  variety  and  importance : 
the  country  itself  in  isolated,  and  has  comparatively  lit- 
tle contact  with,  or  importance  for,  the  markets  of  the 
world.  In  all  these  respects  what  has  been  done  in  the 
Dominion  of  the  South  Pacific  during  the  last  twenty 
years  is  open  to  the  objection  that  while  it  is  interesting, 
it  can  be  of  little  practical  value  to  America  or  Eng- 
land. The  experiments  made  on  so  small  a  scale,  it 
may  be  said,  can  have  little  significance  for  communi- 
ties so  differently  situated :  the  many  millions  of  Amer- 
ica or  of  England  can  learn  but  little  from  the  experi- 
ences of  a  little  nation  playing  at  toy  politics  and 
infant  economics,  even  if  the  results  obtained  appear  re- 
markable. 

256 


THE  VALUE  OE  THE  LESSON         257 

Two  answers  may  be  made  to  such  objections  as 
tbese  by  those  who  think  the  experiences  of  iSTew  Zea- 
land worthy  of  the  consideration  of  other  countries, 
whose  conditions  dijEfer,  both  in  kind  and  in  extent, 
from  her  own.  The  first  has  already  been  referred  to 
in  speaking  of  the  truth  that  all,  or  nearly  all  the  ob- 
ject lessons  by  which  mankind  has  profited  in  the  past 
have  been  presented,  in  the  first  instance,  on  a  small 
scale.  The  scale,  indeed,  is  seldom  the  important  mat- 
ter: it  is  the  underlying  principle  of  the  lesson,  and 
the  fact  that  there  is  need  of  some  such  lesson  to  meet 
an  existing  need,  that  is  the  really  important  thing. 
In  the  case  of  the  experiments  made  in  oSTew  Zealand, 
the  underlying  principle  is,  it  must  be  admitted,  a 
novelty  in  the  experiments  of  nations;  it  is  not,  how- 
ever, on  that  account  the  less  important.  It  begins  with 
the  admission  of  social  injustice  and  grievances,  lead- 
ing to  economic,  as  well  as  to  moral  evils  and  mis- 
takes, and  it  proceeds  on  the  principle  —  or  it  may  be 
the  assumption  —  that  the  cure  of  the  moral  evils,  and 
social  injustices  of  the  past  will  be  attended  by  no 
economic  troubles  or  disasters  to  the  community  that  has 
the  courage  to  make  the  experiment. 

The  second  answer  that  may  be  made  to  those  who 
are  inclined  to  treat  such  experiments  as  things  of  lit- 
tle general  importance,  would  naturally  take  the  form 
of  a  question.  Are  the  conditions  —  social,  political, 
and  economic  —  of  their  own  people  so  satisfactory 
that  no  improvement  is  to  be  desired,  or  can  reasonably 
be  hoped  for?  England,  until  lately,  rather  prided 
herself  on  being  called  the  workshop  of  the  world,  and 


258      SOCIAL  WELFAE.E  IN  NEW  ZEALAND 

now  botli  America  and  Germany  are  inclined  to  dispute 
with  her  the  right  to  the  title.  To  the  eyes  of  an  un- 
prejudiced observer  the  workshop  —  whether  it  be  in 
England,  America,  or  Germany,  is  by  no  means  an  at- 
tractive scene.  There  may,  indeed,  be  differences  in 
degree ;  there  is  practically  no  difference  in  the  leading 
features  of  the  cities  in  each  country.  Congestion, 
poverty,  evil  conditions  for  old  and  young,  are  the  al- 
most invariable  rule.  A  life  of  squalor  and  discom- 
fort in  childhood,  succeeded  by  a  life  of  toil  and  ex- 
ertion, unlightened  by  reasonable  opportunity  for  rest 
or  amusement  for  both  men  and  women,  ending,  as  a 
rule,  in  an  old  age  of  penury  and  want.  These,  or 
conditions  nearly  approaching  these,  are  to  be  found  in 
every  great  city  of  Europe  and  America,  and  they  are 
the  conditions  of  a  majority  of  the  inhabitants. 

In  England,  and  other  countries  of  Europe,  these 
conditions  are  very  largely,  it  may  be  said,  the  conse- 
quences of  the  past,  when  freedom,  as  it  is  generally 
understood  to-day  was  an  undeveloped  thing  for  the 
great  majority  of  the  people  of  each  country.  It  was 
then  that  cities  sprung  up  where  the  inhabitants,  all 
but  a  very  limited  class,  were  compelled  to  live  in  dens, 
and  to  be  content  as  long  as  they  could  obtain  enough 
to  eat,  and  nearly  enough  to  cover  them.  The  times 
have  changed,  and  the  need  of  such  places  and  conditions 
of  living  has  passed,  we  shall  be  told.  The  new  era  of 
commercialism  has  already  wrought  a  change  in  the 
circumstances  of  the  great  majority  of  the  workers,  and 
year  by  year  is  doing  more.  In  America,  at  any  rate, 
workers  of  every  kind  are  now  paid  wages  unknown, 


THE  VALUE  OF  THE  LESSON         259 

in  other  countries,  wliile  the  more  skilful  artisans  are 
paid  in  the  great  cities  on  a  scale  undreamed  of  thirty 
years  ago  even  in  America. 

Such  statements  as  these  are  true,  and  yet  they  are 
strangely  deceptive.  It  is  true  that  in  America  skilled 
labour  is  rewarded  with  higher  wages  than  elsewhere ;  it 
is  also  true  that  in  older  cities,  where  evil  conditions 
have  so  long  prevailed  there  has  of  late  been  an 
improvement,  owing  to  better  regulation,  and  more 
intelligent  oversight.  It  is,  if  possible,  still  more  uni- 
versally true  that  the  increased  wages  paid  to  the  work- 
ers in  America,  and  the  other  more  progressive  indus- 
trial countries  of  the  world,  will  not  to-day  purchase 
more,  but  on  the  contrary  rather  less,  of  the  goods  that 
assist  in  family  well-being,  than  the  lower  wages  of 
thirty  years  ago.  Wages  have  risen  —  mainly  under 
compulsion  —  in  every  coimtry :  house-rents,  food, 
clothing,  and  all  other  things  that  produce  general 
well-being  for  the  masses  of  a  people,  have  risen  even 
more  in  price.  And  in  spite  of  oversight  and  regula- 
tion the  conditions  of  life  have  not  greatly  improved 
in  the  world's  g-reat  cities.  It  is  true  that  the  most 
revolting  features  of  most  of  the  great  cities  of  Eng- 
land and  Germany  have  been  improved,  or  swept  away 
—  but  what  of  the  great  cities  of  America  ?  Forty 
years  ago  cities  everywhere,  and  particularly  in  Amer- 
ica, were  not  the  congested  centres  of  population  they 
are  now.  Thirty  years  ago  even  the  families  of  work- 
ers in  'New  York,  Chicago,  and  a  score  of  American 
cities  that  might  be  named,  had  space  to  live  in  some 
comfort,  and  to  breathe  air  that  was  not  too  oppres- 


260     SOCIAL  WELFAEE  m  NEW  ZEALAND 

sively  charged  with  unwholesome  gases.  To-day  the 
east  side  of  New  York,  and  the  stock-yard  districts 
of  Chicago  are  rivalled  in  their  unwholesomeness  — 
physical  and  moral  —  by  the  workers'  quarters  of  fifty 
overcrowded  cities  in  the  country. 

For  these  evils,  and  such  as  these  —  for  the  life  of 
the  streets,  and  the  workers'  tenements  —  it  may  be 
said  there  is  no  remedy.  These  are  part  of  the  price, 
it  may  be  asserted,  of  success  in  the  struggle  for  com- 
mercial supremacy  and  national  wealth.  There  must, 
of  course,  be  some  drawbacks  to  every  great  success; 
and  it  is  foolish  to  concentrate  attention  on  the  draw- 
backs, and  to  ignore  the  advantages.  The  argument  is 
familiar,  and  it  might  even  be  forcible  if  it  did  not 
leave  out  of  account  the  comparative  value  to  the  na- 
tion of  what  is  gained  and  what  is  lost.  Commercial 
supremacy  is  the  great  object  towards  which  the  am- 
bitions of  the  average  man  of  this  commercial  age 
points.  To  him  success  in  attaining  this  object  is 
really  the  highest  national  success  of  which  he  has  any 
idea.  To  command  for  his  goods  the  most  prominent 
place  in  the  world's  markets  seems  to  him  to  mean 
not  only  national  importance  but  national  wealth; 
and  small  matters,  such  as  tlie  happiness  and  well-be- 
ing of  the  men  who  do  the  work,  and  the  well-being 
of  their  families,  seem  in  comparison  but  trifling  things. 
Commercial  supremacy  is  an  object  of  ambition  to  a 
certain  class  of  the  people  of  America,  England,  and 
Germany  to-day,  because  it  appears  to  them  to  mean 
riches,  not  for  their  country,  or  its  people,  but  for  them- 
selves. 


THE  VALUE  OF  THE  LESSO:^sr         261 

For  the  majority  of  thoughtful  men  it  can  hardly 
be  too  much  to  hope  that  a  broader  and  wiser  ambi- 
tion than  this  may  have  some  attractions.  The  riches 
of  which  the  average  man  imbued  with  the  spirit  of 
commercialism  is  thinking  are  the  riches  he  may  hope 
to  gain  for  himself,  or  at  the  most  those  that  will  be 
confined  to  the  class  to  which  he  belongs ;  and  no  nation 
ever  grew  really  wealthy  by  the  vast  accumulation  of 
riches  in  a  few  hands.  The  world  —  even  the  world 
of  associated  humanity  —  is  old  enough  to  afford  evi- 
dence of  this.  There  have  been  a  good  many  nations 
that  in  their  turn  have  become  rich  in  this  way;  but 
there  is  no  case  recorded  in  history  in  which  their  pros- 
perity continued  long.  The  experience  of  human  so- 
ciety has  been  uniform  in  this  respect  at  least:  the 
accumulation  of  great  riches  in  a  few  hands  was  in- 
variably the  fore-runner  of  national  decay  and  disaster. 
Their  possession  became  an  occasion  of  envy  from  with- 
out, or  of  bitter  dissatisfaction  within  their  borders, 
till  it  became  only  a  question  of  time,  and  of  no  long 
time,  how  soon  they  lost  the  position  of  pre-eminence 
they  had  attained  and  misused. 

In  such  things  as  these  at  least  it  is  true  that  there 
is  no  new  thing  under  the  sun.  Already  the  first  notes 
of  warning  can  be  clearly  heard  in  the  social  atmos- 
phere of  each  of  the  great  countries  most  imbued  with 
the  spirit  of  modern  commercialism.  In  Germany,  in 
England,  and  in  America  the  sound  may  be  heard  with 
a  clearness  that  increases  year  by  year,  in  the  political 
life  of  the  people.  Unrest,  trade  discontent,  extreme 
socialism,  and  even  anarchist  doctrines  are  spreading 


262     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

among  the  masses  of  the  people  in  eaeli  country,  till, 
compared  with  that  which  was  the  case  ten  years  ago, 
they  are  looked  on  as  natural  and  even  common-place. 
It  may  be  easy  for  some  people  to  shut  their  eyes  to 
such  things  as  these,  and  in  their  childish  optimism  to 
assure  themselves  and  others  that  all  will  go  well  if 
things  are  let  alone,  or  at  the  most  dealt  with  when 
they  come  to  a  head  that  can  no  longer  be  disregarded. 
Such  people,  and  such  opinions  are  by  no  means  a  nov- 
elty in  the  political  history  of  nations.  The  optimism 
that  fears  nothing  because  it  knows  little,  is  a  very  old 
form  of  the  virtue ;  one  that  has  been  practised  in  many 
countries,  and  has  led  to  many  disasters.  National 
unrest,  national  discontent  with  the  conditions  that  ex- 
ist, followed  by  gropings,  however  vague  and  theoret- 
ical, after  change,  have  a  meaning  for  thoughtful  men, 
and  a  meaning  that  can  never  safely  be  disregarded. 
The  desire  for  change  means  dissatisfaction :  the  result 
of  dissatisfaction,  when  it  affects  a  majority  of  any 
people,  means  agitation  and  revolution,  and  the  loss, 
more  or  less  complete,  of  national  well-being. 

Great  radical  reforms  in  the  life  of  nations  are  al- 
ways serious  things,  if  only  because  the  interests  they 
affect  are  great:  and  it  cannot  honestly  be  denied  that 
a  change  from  a  national  policy  of  commercialism  to 
one  of  State  Socialism  of  the  New  Zealand  type  would 
be  a  radical  one.  To  appreciate  this  it  is  only  nec- 
essary to  remember  that  the  objects,  purposes,  and 
even  the  methods  of  the  two  policies  are  so  essentially 
different  that  they  may  almost  be  said  to  be  opposed 
to   one   another.     In   England   for   centuries,    and   in 


THE  VALUE  OF  THE  LESSOK         263 

America  for  half  a  century,  the  laws  of  the  country 
have  been  practically  made  by  one  class  of  the  people, 
and,  as  might  have  been  expected,  they  have  been  made 
to  suit  the  needs  and  purposes  of  that  class.  In  Eng- 
land the  class  was  the  commercial  class,  more  or  less 
controlled  by  the  older  class  of  the  nobility  and  land 
o^mers  of  the  countiy:  in  America  the  class  has  been 
that  of  the  capitalists,  the  manufacturers,  the  specu- 
lators, and  others  engaged  in  heaping  up  riches  for 
themselves,  uncontrolled  by  anything  but  the  consider- 
ation of  their  own  selfish  interests.  In  both  countries 
the  legislation  has,  for  the  most  part,  followed  the 
instincts  of  the  class  for  whose  benefit  it  was  primarily 
intended.  Laws  were  enacted  in  both  countries,  in- 
deed, that  had  good  results  for  all  classes  of  the  na- 
tion, but  in  both  countries,  and  in  almost  every  instance, 
the  object  kept  in  view  was  a  commercial  one. 

The  purpose  was,  in  at  least  nine  cases  out  of  ten, 
a  purely  commercial  one,  adapted  to  the  ideas  of  a 
community  in  which  the  rich,  and  those  who  were  en- 
dowed with  the  special  talents  that  lead  to  riches,  were 
of  importance,  and  those  who  were  neither  rich  already 
nor  likely  to  become  rich  soon,  were  only  thought  of 
as  the  tools,  by  means  of  which  the  riches  of  the  other 
class  could  be  increased.  It  cannot  be  denied  that 
the  purpose  has  been  served,  and  the  object  attained. 
Both  in  America  and  England  the  rich  have  been  grow- 
ing richer  at  a  rate  never  befo^-e  equalled,  during  the 
last  thirty  years ;  and  in  both  countries  —  though  it 
need  hardly  be  said  they  will  be  slow  to  acknowledge 
it  —  they  have  been  doing  so  very  largely  at  the  ex- 


264     SOCIAL  WELFARE  IN  NEW  ZEALAND 

pense  of  their  poorer  neighbours.  A  new  policy  that 
means  the  very  reverse  of  this  may  naturally  be  looked 
on  as  rash,  and  revolutionary.  A  policy  which  instead 
of  the  rich,  takes  the  class  of  the  poor,  or  at  least  that 
of  the  comparatively  poor,  as  the  main  object  of  its 
legislation:  one  that  starts  with  the  principle  that  the 
single  purpose  of  national  life  ought  to  be  the  well- 
being  of  every  part  of  the  community  —  a  policy  to 
which  the  over  riches  of  the  multi-millionaire  is  a 
thing  as  objectionable  as  the  extreme  poverty  of  the 
east-side  worker  of  New  York,  or  the  inhabitant  of 
the  London  slums.  Such  a  suggested  change  as  this, 
it  need  hardly  be  said,  would  be  radical  enough  to  cause 
hesitation,  and  create  alarm :  yet  this  would,  in  effect, 
be  the  meaning  of  a  change  from  the  policy  of  extreme 
commercialism,  prevailing  in  America  and  England  to- 
day, to  that  of  State  Socialism  —  practised,  more  or 
less  completely,  in  New  Zealand  during  the  last  twenty 
years.  The  question  for  consideration  is  whether  the 
change  is  worth  making. 

In  trying  to  answer  such  a  question  as  this  it  must 
be  confessed  the  point  of  view  is  everything.  From 
that  of  the  millionaire,  who  hopes  to  grow  still  richer, 
or  of  the  multi-millionaire  who  feels  that  the  joy  of 
life  consists  in  the  power  which  his  riches  give  him 
over  his  fellow  men,  the  answer  would  of  necessity  be 
in  the  negative.  From  that  of  the  young  man  —  con- 
scious, it  may  be,  of  unusual  abilities  of  the  kind  that 
naturally  enable  men  to  grow  rich  at  the  expense  of 
their  fellows, —  the  answer  could  hardly  be  expected  to 
be  different.     To  the  great  mass  of  the  people,  how- 


THE  VALUE  OF  THE  LESSON         265 

ever, —  those  who  have  at  present  barely  enough  for 
comfort  and  well-being,  or  those  who  have  so  little  that 
they  hardly  understand  what  well-being  means  —  who 
number  at  least  a  score  to  every  one  of  the  other  classes, 
it  may  even  now,  as  it  certainly  will  at  some  time  here- 
after, be  in  the  affirmative. 

Perhaps  the  most  remarkable  feature  of  Kew  Zea- 
land's object  lesson,  at  least  from  an  economic  point 
of  view,  is  the  evidence  it  affords  on  one  point,  and 
that  the  most  unexpected  of  all, —  the  policy  is  the 
most  profitable  of  all  national  policies  yet  adopted. 
This,  indeed,  is  not  its  highest  recommendation ;  it  is 
one,  however,  so  unexpected,  and  so  contradictory  of  all 
past  experience,  that  it  cannot  be  lost  sight  of  without 
injustice  in  dealing  with  the  question. 

On  this  point  the  evidence  is  conclusive.  ITew  Zea- 
land adopted  a  policy  that  was  in  absolute  contradic- 
tion of  the  received  and  accepted  principles  of  national 
political  economy  —  a  policy  that  might  be  defended 
on  grounds  of  benevolence,  or  even  of  an  overstrained, 
and  somewhat  sentimental  desire  to  give  opportunity 
to  the  class  that  had  hitherto  had  the  least  opportunity 
of  advancement  twenty  years  ago.  The  result  that 
was  not  anticipated,  either  by  the  supporters  or  oppo- 
nents of  the  policy  in  ISTew  Zealand  or  elsewhere  was 
the  one  that  is  the  most  apparent  of  all  —  the  policy 
has  paid,  to  an  extent  that  can  be  claimed  for  no  other 
national  policy  ever  adopted  by  any  country.  The 
last  twenty  years  has  been  a  period  of  great  events 
in  the  commercial  world.  Business  has  increased  as 
it  never  did  before  in  many  of  the  countries  of  the 


266     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

civilised  world:  nowhere  has  it  increased  in  anything 
like  the  proportion  that  it  has  increased  in  New  Zea- 
land. Wealth  has  poured  into  several  countries  as  it 
never  did  before,  so  that  America,  England,  and  Ger- 
many, as  the  great  commercial  countries  of  the  time 
congratulate  themselves  on  an  unprecedented  increase 
in  the  amount  of  their  wealth :  none  of  them  have  in- 
creased in  riches  —  in  the  amount  of  goods  exported, 
or  the  amount  of  riches  gained, —  in  proportion  to  the 
numbers  of  their  people,  one-half  as  rapidly  as  New 
Zealand  and  its  people  during  the  period.  These  are 
the  facts:  it  can  hardly  be  questioned  that  they  de- 
mand consideration  from  the  nations  whose  policy  has 
been  that  of  the  market  place,  and  whose  success  has 
been  so  greatly  exceeded  by  a  country  that  has  aban- 
doned the  policy  of  the  market  for  that  of  human 
brotherhood. 


CHAPTER  III 

HOW    THE   LESSON    MAY    BE    USED 

The  object  lesson  from  New  Zealand  is,  as  has  al- 
ready been  admitted,  nothing  short  of  revolutionary. 
If  it  is  to  be  accepted  as  a  lesson,  called  for  by  the 
conditions  of  the  world's  great  centres  of  civilisation 
to-day,  and  justified  by  the  success  that  has  attended 
it  in  the  only  country  in  which  it  has  been  put  to  the 
test  of  actual  experiment;  the  question  that  arises, 
and  demands  an  answer,  is  in  what  way  it  can  best 
be  used.  In  the  preceding  chapters  of  this  book  an 
attempt  has  been  made  to  trace  the  course  of  the  New 
Zealand  experiments,  and  no  attempt  has  been  made 
to  conceal  their  meaning.  That  meaning  is  frankly 
revolutionary.  It  starts  with  a  new  conception  of  the 
real  meaning  of  the  human  association  which  we  call 
a  nation.  It  proceeds  on  the  principle  that  the  pur- 
pose —  the  only  worthy,  and  in  the  long  run  the  only 
satisfactory  purpose  —  of  such  a  society,  is  to  provide 
for  the  well-being  of  all  its  members.  Warned  by  the 
lamentable  failure  of  the  past  to  secure  any  such  re- 
sult, it  defies  long  accepted  ideas  and  methods,  both 
social  and  economic,  and  proceeds  to  inaugurate  a  new 
system  of  political  economy,  which  substitutes  fair-play 
and  kindness  for  the  rule  of  the  strongest,  and  justice 
to  all  classes,  for  the  advantage  of  one. 

267 


268      SOCIAL  WELFAEE  IN  NEW  ZEALAND 

In  the  former  chapters  we  have  pointed  out  that 
the  new  policy  has  not  only  made  a  people  happy  and 
contented,  as  no  one  of  all  the  peoples  of  the  great 
industrial  countries  of  Europe  or  America  are,  or  have 
any  good  reason  to  be,  -at  present.  We  have  also 
shown,  on  the  authority  of  evidence  that  cannot  be 
contradicted,  and  can  hardly  be  misunderstood,  that  this 
happiness  and  contentment  has  nothing  in  common 
with  the  idle  self-indulgence  that  we  connect  with  our 
pictures  of  life  in  a  palm-fringed  tropical  island,  where 
life  is  uneventful,  and  food  can  be  got  without  ef- 
fort; but  that  energy,  enterprise,  and  providence  for 
the  future,  are  marked  characteristics  of  the  people. 
Finally  we  have  seen,  on  the  same  evidence,  that 
twenty  years  of  this  policy  has  led  to  a  financial  suc- 
cess and  development,  such  as  cannot  be  equalled  by 
that  of  the  richest  and  most  energetically  commercial 
nations  of  the  time. 

This,  it  will  hardly  be  denied,  is  a  social  revolution 
that  has  much  to  recommend  it  for  every  thoughtful 
citizen  of  any  of  those  great  countries,  that  are  fore- 
most in  all  but  the  well-being  and  happiness  of  the  ma- 
jority of  their  people.  But  it  is  not  sufficient  that 
better  social  arrangements  may  have  been  proved  to 
be  possible  in  some  distant  country:  the  most  really 
interesting  point  is,  whether,  and  by  what  means,  they 
can  be  introduced  at  home  —  especially  if  that  home 
means  one  of  the  world's  great  nations  of  to-day,  where 
the  evils,  of  which  everybody  is  conscious,  though  some 
are  able  to  shut  their  eyes  to  its  enonnity,  form  so 
large  a  part  of  the  national  life. 


HOW  THE  LESSO]^  MAY  BE  USED     2G9 

It  would  be  both  rash  and  foolish  to  undertake  any 
general  statement  as  to  the  particular  steps  that  could 
be  taken  successfully  to  introduce  better  social  and  eco- 
nomic conditions  in  any  country.  Many  things  exist 
in  different  countries  to-day  —  the  people,  their  tradi- 
tions, and  their  present  conditions  —  which  would  re- 
quire consideration,  and  might  all  lead  to  different 
conclusions.  What  we  have  endeavoured  to  show  in 
this  book  has  been,  in  the  first  place,  that  it  is  possi- 
ble to  inaugurate  a  social  reform  of  a  kind  that  is 
likely  to  do  away  with  many  existing  evils;  and  that 
such  a  reform  can  be  made,  without  in  any  way  de- 
stroying the  commercial  prosperity  of  the  country,  or 
its  people.  This  has  been  actually  done  on  a  scale 
sufficiently  large  to  demonstrate  the  fact;  and,  if  we 
are  right  in  believing  that  it  is  essential  for  the  further 
development  of  civilised  humanity  that  some  such  re- 
form should  be  made  general,  it  is  a  great  step  to  have 
ascertained  that  the  reform  is  possible. 

As  a  second  step  towards  the  realisation  of  new  con- 
ditions of  betterment  for  the  people  of  every  nation, 
one  thing  at  least  is  necessary.  It  consists  in  the 
realisation  by  the  people  generally,  and  by  those  who 
represent  them  in  their  legislative  assemblies,  that  in 
many  respects  past  ideals  of  society  have  been  mis- 
taken, and  have  led  to  manifold  evils;  and  that  it  is 
time  they  should  give  way  to  others  founded  on  dif- 
ferent principles,  and  looking  to  different  results. 
The  very  old,  and  very  erroneous  idea  that  the  wealth 
of  a  nation  can  be  estimated  by  the  riches  of  a  class 
of  its  people,  must  give  way  to  the  new  ideal  of  national 


270     SOCIAL  WELFAEE  m  NEW  ZEALAND 

wealth,  which  consists  in  the  well-being,  and  sufficient 
provision  for  all,  and  not  for  a  few  of  its  people  only. 
The  old  fetish,  so  fully  believed  in,  and  so  generally 
taught,  which  looks  on  accumulated  riches,  under  the 
almost  sacred  name  of  "  Capital,"  as  the  chief  element 
in  the  well-being  of  a  nation,  and  gives  its  protection, 
and  its  influence  the  leading  place  in  the  legislation 
and  administration,  must  be  abandoned,  as  little  bet- 
ter than  a  relic  of  the  dark  ages  of  semi-barbarism. 
Instead  of  making  laws  for  the  protection  of  capital 
the  laws  must  be  directed  chiefly  to  the  protection  of 
the  majority  of  the  nation,  who  have  hitherto  been  sac- 
rificed to  capital,  and  the  class  that  possessed  capital 
of  the  kind  commonly  accepted  as  such. 

This  adoption  of  what  may  be  called  the  new  ideal 
of  social  legislation  is  not  likely  to  be  accepted  readily 
in  any  country  in  which  the  opposite  ideals  have  pre- 
vailed for  many  generations,  and  in  some  cases  for 
many  centuries,  but  it  is  an  absolutely  necessary  condi- 
tion of  success.  Half  measures,  in  this,  as  in  every- 
thing that  is  worth  undertaking  at  all,  will  result  in 
failure  instead  of  success ;  or  at  the  best  its  success 
will  have  many  of  the  elements  of  failure  to  deform 
it.  On  the  other  hand  it  must  be  remembered  that  one 
of  the  most  essential  conditions  of  successful  reform 
is  the  avoidance  of  anything  like  rash  haste.  This,  as 
all  the  history  of  the  past  teaches,  has  been  the  fatal 
mistake  made  in  nearly  every  social  and  political 
revolution  the  world  has  seen.  Experience,  and  not 
theory,  however  excellent,  has  been  the  teacher  of  hu- 
manity from  the  first ;  and  while  the  experience  of  bad 


HOW  THE  LESSOR  MAY  BE  USED     271 

and  unjust  conditions  has  led  to  many  attempts  at  re- 
form, there  has,  as  a  rule,  been  absent  the  experience 
necessary  to  show  how  the  reforms  were  to  be  brought 
about,  and  in  what  way  the  society  could  best  be  pre- 
pared for  them.  This,  no  doubt,  is  the  reason  why 
revolutions  have  so  rarely  resulted  in  real  or  perma- 
nent reforms.  It  was  not  that  the  evils  complained  of 
were  not  sufficiently  real,  and  more  than  sufficiently 
oppressive.  It  was  not,  as  a  rule,  that  the  leaders  of 
the  movement  were  not  —  at  least  in  many  cases  — 
really  anxious  to  bring  about  what  seemed  to  them  a 
better  state  of  things,  that  was  the  cause  of  the  fail- 
ure: it  was  almost  invariably  their  own  and  their  fol- 
lowers' want  of  experience  of  what  was  wanted  to  pro 
duce  the  better  conditions  sought,  and  how  it  could  be 
obtained  and  used. 

We  have  attempted  to  explain,  in  the  case  of  ISTew 
Zealand,  both  why  the  particular  reforms  adopted 
there  were  specially  called  for,  and  the  process  by 
which,  in  each  case,  the  reform  has  been  made.  This 
has  been  done  at  what  may  have  seemed  to  some  read- 
ers an  unnecessary  length,  because  it  appeared  desir- 
able in  this  way  to  suggest  the  value  of  deliberation 
and  caution  in  dealing  with  such  questions.  The 
twenty  years'  experience  of  New  Zealand  claims  to  be 
of  value  to  the  rest  of  the  world,  not  merely  as  show- 
ing what  may  be  done  for  the  improvement  of  social 
conditions,  but  as  suggesting  in  many  ways  the  way  in 
which  it  can  be  safely  done.  In  New  Zealand  very 
much  has  been  accomplished  to  make  a  whole  people 
contented,  happy,   and  singularly  prosperous:  the  ex- 


272     SOCIAL  WELFARE  IN"  NEW  ZEALAND 

perience  of  that  country  goes  no  farther  than  this  — 
to  show  how  these  good  results  can  be  secured  by  fol- 
lowing a  single  leading  principle  in  legislation  with 
steady  persistency  for  twenty  years.  It  has  nothing  to 
say  in  favour  of  hastily  adopted  measures  of  reform, 
and  certainly  nothing  to  say  in  favour  of  extreme  meas- 
ures, adopted  on  grounds  of  theory.  That  it  has  been 
successful  may  be  claimed,  as  a  matter  beyond  reason- 
able doubt.  This  success,  however,  does  not  mean 
that  the  statutes  of  New  Zealand,  if  enacted  in  other 
countries,  would  prove  to  be  a  panacea  for  the  social 
evils  that  exist  there. 

It  need  not  be  supposed  that  any  particular  credit  is 
claimed  either  for  the  Parliament  or  people  of  New  Zea- 
land in  the  matter.  It  is  hardly  too  much  to  say  that 
they  hardly  appreciated  the  full  importance,  or  even 
the  full  meaning,  of  what  they  were  doing  from  year 
to  year.  The  one  point  on  which  they  were  clear  was 
the  general  principle  on  which  their  legislation  pro- 
ceeded. In  their  case  it  can  hardly  be  said  that  the- 
ory had  anything  to  do  with  the  matter.  The  well- 
being  of  the  people,  as  a  whole,  was  the  object  aimed 
at  —  not  the  prosperity  of  business,  not  the  increase 
of  exports,  not  the  development  of  manufactures, —  and 
it  was  found,  almost  to  their  surprise,  that  what  was 
done  to  advance  the  well-being  of  the  majority  of  the 
people  —  and  especially  of  that  part  of  the  people  that 
needed  advancement  most  —  included  all  the  others. 
Business  became  brisk,  and  has  continued  brisk ;  manu- 
factures of  many  new  kinds  have  been  increased,  and 
are  flourishing;  the  exports  of  the  country  have  in- 


HOW  THE  LESS0:N'  MAY  BE  USED     273 

creased  beyond  the  experience  of  other  nations  —  and 
all,  it  would  appear,  as  the  consequence  of  a  policy 
that  was  aiming  at  something  else.  Perhaps  the  most 
striking  feature  of  the  object  lesson  of  New  Zealand's 
experience,  after  all,  is  therefore  the  testimony  it  bears 
in  favour  of  the  two  leading  features  of  legislation :  for 
a  really  public-spirited  object  entering  into  every  law 
passed  by  its  legislature,  and  deliberation  in  the  process 
of  reform. 

These  two  lessons  are  of  a  kind  that  may  be  taken 
advantage  of  by  every  country  that  is  conscious  of 
social,  political,  or  economic  abuses.  If  a  free  peo- 
ple, endowed  with  the  powers  of  self-government,  and 
the  responsibility  of  selecting  the  representatives  who 
are  to  make  their  laws,  has  once  awakened  to  the  truth 
that  there  is  something  materially  wrong  with  the  con- 
ditions of  a  large  proportion  of  their  people,  they  can 
use  the  object  lesson  with  but  little  difficulty.  They 
will  take  steps  to  elect  Representatives  to  their  Legis- 
lature, not  because  they  represent  this  party  or  that  — 
not  because  they  are  good  Republicans,  or  staunch 
Democrats;  not  because  they  are  Liberals  or  Conserva- 
tives, or  even  Radicals,  if  they  are  in  England  —  but 
because  they  are  fully  committed  to  a  policy  of  national 
reform;  and  because  they  are  men  who  can  be  trusted 
to  remain  true  to  their  opinions.  There  are  many 
such  men  to  be  found  both  in  America  and  England, 
though,  as  a  general  rule,  they  have  not  occupied  seats 
in  either  State  or  National  Parliaments  or  Legislatures. 
To  such  men  the  needs  of  their  own  country  and  peo- 
ple would  be  known,  and  they  could  be  trusted  to  deal 


2Y4     SOCIAL  WELFAEE  IN  NEW  ZEALAND 

■with  them,  not  as  imitators  of  other  countries,  but  as 
statesmen  who  could  use  the  experience  of  others,  and 
adapt  it  to  the  needs  of  their  own  people. 

The  Object-Lesson  of  New  Zealand  is,  therefore,  one 
that  may  be  valuable  to  many  countries,  and  a  help 
to  many  communities,  if  it  is  rightly  used.  It  is  not 
meant  for  servile  imitation,  nor  is  it  even  suggested 
that  the  laws  that  have  been  enacted  there,  and  have 
proved  successful,  would  prove  an  equal  success  in  an- 
other, and  very  different  community.  Some  of  the 
New  Zealand  statutes  might  indeed  prove  eminently 
useful  in  older  and  vastly  more  populous  countries ;  but 
in  all  probability  it  would  be  rather  the  spirit  than  the 
letter  that  would  be  of  service.  The  policy  of  New 
Zealand  might  well  be  adopted  in  America  or  England, 
as  far  as  that  policy  substitutes  the  good  of  the  peo- 
ple for  the  supposed  advancement  of  commerce  and 
the  eagerly  desired  heaping  up  of  riches.  It  would,  as 
has  already  been  said,  mean  a  reform  that  would 
amount  to  a  social  and  political  revolution ;  it  need  not 
be  accompanied  by  any  of  the  features  of  terror  with 
which  it  is  customary  to  connect  a  revolution.  In  this 
respect,  at  any  rate,  the  example  of  New  Zealand  may 
be  accepted  as  one  of  almost  universal  application.  It 
need  not  be  said  that  reforms  on  any  large  scale  always 
involve  some  amount  of  disturbance  of  existing  condi- 
tions, and  must  always  provoke  the  opposition  of  those 
who  are  —  or  believe  themselves  to  be  —  the  sufferers 
by  the  new  order  of  things  which  the  reforms  intro- 
duce. This  has  been  the  experience  of  New  Zealand, 
and  it  would  be  so,  in  all  probability  to  a  greater  ex- 


HOW  THE  LESSON  MAY  BE  USED     2T5 

tent,  in  countries  like  America  or  England;  but  if  tlie 
reforms  were  introduced  gradually,  as  they  have  been 
in  'New  Zealand,  there  would  be  little  danger  of  vio- 
lent opposition,  and  little  reason  to  fear  any  serious 
interruption  in  the  prosperity  of  the  country  or  of  its 
people. 

America,  it  may  be  said,  has  some  special  advantages 
for  the  adoption  of  a  national  reform  of  this  kind. 
The  evils  —  political,  social,  and  economic  —  that  al- 
ready exist  in  so  new  a  country  are  sufficiently  promi- 
nent, and  sufficiently  unnecessary,  to  arouse  attention, 
and  demand  from  all  intelligent  citizens  some  special 
effort  for  their  cure.  The  difficulty,  in  the  case  of  a 
community  at  once  so  large  and  containing  so  mixed 
a  population,  of  dealing  with  the  problem  of  a  gen- 
eral betterment  of  conditions,  is  so  great  that  under 
other  political  conditions  than  those  of  America  it 
might  appear  almost  too  great  to  be  grappled  with  suc- 
cessfully. In  America,  however,  the  political  consti- 
tution of  the  country  lends  itself  with  unusual  aptitude 
to  the  task.  That  which  might  be  looked  on  as  all 
but  hopeless,  if  the  reforms  required  had  to  be  made 
on  a  national  scale  in  the  first  instance,  is  compara- 
tively easy  and  simple,  if  the  experiment  is  confined 
to  a  single  State  of  no  very  great  or  mixed  population. 
A  single  American  State,  containing  one  or  two  million 
inhabitants,  could  do  as  ISTew  Zealand  has  done  in  many 
respects;  and  might  hope  to  profit,  as  New  Zealand 
and  its  people  have  profited,  by  the  experience. 

In  case  of  the  willingness  of  the  people  of  such  a 
State  to  profit  by  the  experience  of  another  country 


276     SOCIAL  WELFAEE  m  NEW  ZEALAND 

in  matters  of  deep  and  increasing  interest  to  them- 
selves, there  would  be  no  serious  obstacle  in  the  way 
of  their  doing  so.  Some  part  of  'New  Zealand's  ex- 
perience, it  is  true,  could  only  be  used  on  a  national 
scale,  such,  for  instance,  as  the  nationalisation  of  the 
railroads  and  telegraph  systems,  but  these,  it  is  no 
great  stretch  of  the  imagination  to  believe,  will  in  any 
case  be  taken  over  ere  long  as  Public  Utilities  that  can- 
not be  left  in  private  hands  without  manifest  injury 
to  the  interests  of  the  nation.  It  is  in  the  region  of 
what  we  have  termed  the  Minor  Utilities  that  a  coun- 
try divided  into  many  self-governing  States  has  the  ad- 
vantage for  purposes  of  experimental  legislation  — 
and  it  is  here  that  America  might  hope  to  gain  much 
by  the  study  of  the  experiments  of  New  Zealand.  The 
conditions  of  the  country  are  by  no  means  the  same,  it 
is  true :  the  people  are  in  some  respects  different ;  but 
the  need  for  reform  is  even  more  apparent  in  America 
than  it  ever  was  in  New  Zealand,  and  the  means  of 
bringing  it  about  are  at  their  own  disposal.  America, 
like  England,  is,  or  very  soon  will  be,  at  the  parting 
of  the  ways.  One  of  these  leads  upward  to  better 
things  for  its  people  by  reform ;  the  other  downward,  by 
the  descent  to  revolutionary  violence.  It  is  for  her  peo- 
ple to  choose  between  them. 


CHAPTER  IV 

A    POSSIBLE    SOLUTION    OF    THE    PROBLEM 

The  question  with  which  we  closed  our  last  chapter 
is  one  of  world-wide  importance.  Human  experience, 
and  especially  that  part  of  it  which  relates  to  human 
beings  associated  in  communities,  has  been  described 
as  a  long,  slowly  moving,  picture  of  gradual  evolu- 
tion. From  a  condition  of  barbarism  that  was  barely 
human,  upwards  to  one  we  can  recognise  as  faintly 
resembling  something  we  can  understand  and  even 
sympathise  with ;  and  so  on,  step  by  step,  towards 
something  better  still  —  with  many  failures  for  each 
success,  yet  on  the  whole  with  progress.  And  after 
all  those  centuries  of  progress  associated  humanity  re- 
mains to-day  more  of  a  failure  than  a  success.  Still, 
as  at  first,  it  is  the  few  that  profit,  the  many  that  suf- 
fer. In  one  country,  and  practically  only  one,  a  defi- 
nite and  persistent  effort  has  been  made,  during  the 
last  twenty  years,  to  take  another  step  upwards  —  a 
step  that  shall  place  justice  before  self-interest,  right- 
eousness before  covetousness,  fair-dealing  between  man 
r.nd  man  before  the  selfishness  that  seeks  to  grasp  every- 
thing possible  for  the  strongest.  That  effort  has,  if 
the  facts  stated  in  the  former  chapters  of  this  book  are 
to  be  credited,  been  an  amazing  success  in  'New  Zea- 

277 


2Y8     SOCIAL  WELFARE  IN  NEW  ZEALAND 

land.  Its  people  have  advanced  in  well-being  as  indi- 
viduals far  beyond  the  experience  of  other  nations; 
they  have  also  increased  in  wealth  at  a  rate  unequalled 
by  any  other  nation.  If  these  things  are  true  there 
must  be  a  reason  that  will  account  for  the  anomaly. 

The  nations  most  advanced  in  civilisation  to-day  caU 
themselves  Christian,  and  profess  to  believe  that  nearly 
nineteen  hundred  years  ago  the  Founder  of  the  faith 
they  follow  taught  men,  as  they  have  never  been  taught 
before  or  since,  the  laws  of  a  kingdom,  which  he  said 
had  even  then  come  among  men  to  ensure  their  happi- 
ness and  well-being.  Through  all  the  centuries  that 
have  passed  since  then  the  nations  of  Europe  have  had 
before  them  the  record  of  that  teaching,  and  that  code 
of  laws;  and  through  all  the  centuries  they  have,  as 
communities,  if  not  always  as  individuals,  ignored 
them.  The  code  of  laws  was  a  complete  and  a  far- 
reaching  one.  It  embraced  laws  for  the  individual, 
and  others  for  communities  such  as  we  call  nations,  and 
it  treated  all,  whether  singly  or  in  association,  as  citi- 
zens of  a  kingdom  which  was  spoken  of  as  "  The  King- 
dom of  Heaven,"  or  "  The  Kingdom  of  God." 

The  new  kingdom  was,  if  the  words  of  the  great 
Teacher  are  read  honestly  and  naturally,  to  be  a  real 
one  that  claimed  the  obedience  of  men  —  both  as  indi- 
viduals and  associations  —  to  the  laws  of  the  kingdom. 
The  one  grand  principle  that  formed  the  foundation 
of  the  code  was  the  principle  of  unselfishness.  It  dealt 
with  men  in  their  relations  to  the  King,  indeed,  but 
most  of  all  it  dealt  with  them  in  their  relations  to  one 
another.     In  the  picture  of  that  kingdom  presented 


A  POSSIBLE  SOLUTIOIT  279 

bj  the  world's  great  Teacher  Society  consisted,  not  of 
a  casually  associated  crowd  of  human  beings,  but  of 
one  great  Brotherhood  of  men,  bound  together  by  fam- 
ily affection,  and  linked  to  one  another  by  the  oppor- 
tunities which  their  association  afforded  for  mutual 
consideration  and  helpfulness.  The  citizens  of  this 
kingdom  were  to  be,  and  to  look  on  themselves  as  be- 
ing, brothers.  Their  social  arrangements  were  to  be 
those  of  a  family  —  a  family,  in  which  some  members 
would  have  greater  powers,  more  talent,  more  perse- 
verance, and  self-control  than  others,  but  one  in  which 
mutual  help  should  be  the  first  principle  of  conduct. 

In  announcing  the  establishment  of  this  new  king- 
dom, so  strange  to  the  ideas  and  experiences  of  asso- 
ciated mankind,  the  Teacher  congratulated  the  poor 
and  oppressed,  not  because  they  were  poor  and  down- 
trodden, but  because  the  fact  would  make  them  ready 
to  become  the  first  willing  citizens  of  the  kingdom.  He 
spoke  sympathisingly  of  the  rich,  because  the  very  fact 
of  their  riches  made  it  so  much  harder  for  them  to 
accept  the  idea  of  the  kingdom,  and  to  obey  its  laws  of 
unselfishness.  Association,  and  the  duties  of  men  in 
association,  were  the  principal  subject  of  the  new  teach- 
ing, and  the  establishment  of  such  a  kingdom  as  this 
was  the  "  Good  News  "  which  the  great  Teacher  had 
to  tell.  It  is  not  wonderful  that  the  news  was  but 
coldly  received  by  the  greater  part  of  his  hearers. 
Such  a  kingdom  did  not  appear  to  be  desirable  for  those 
who  already  had  a  good  deal  more  than  their  neigh- 
bours; it  was  even  less  attractive  to  the  class  that  had 
a  great  deal  more.     The  news  was  first  told  to  a  peo- 


280     SOCIAL  WELFARE  m  :N"EW  ZEALAND 

pie  that  was,  more  than  almost  any  other  people,  com- 
mercial in  its  ideas  and  tendencies;  and  for  such  a 
people  it  had  few  attractions.  Since  then,  through 
ages  of  persecution,  or  of  reluctant  acceptance  and  toler- 
ation, the  idea  has  remained,  a  thing  submitted  to,  but 
never  acted  upon. 

Through  the  later  centuries  of  Roman  power; 
through  what  we  know  as  the  middle  ages;  through 
century  after  century  of  the  development  of  modern 
civilisation,  and  the  gradual  rise  of  the  age  of  modern 
Commercialism,  men,  and  associations  of  men,  have 
continued  to  accept,  without  believing  in,  the  idea  of 
"  The  Kingdom  of  Heaven,"  announced  by  the  great 
Teacher  of  nineteen  centuries  ago.  They  have  discov- 
ered that  he  did  not  mean  what  his  words  seemed  to 
mean.  They  have  concluded  that  this  kingdom  must 
have  been  something  that  was  altogether  individual  and 
spiritual,  not  a  thing  that  was  to  alter  the  laws  of  na- 
tions, and  change  the  face  of  society.  The  fact  that 
in  all  the  world's  Communities  some  people  were  rich 
and  powerful,  either  because  of  some  special  qualities 
of  their  own,  or  because  of  some  that  had  belonged  to 
their  ancestors,  seemed  to  them  a  sufficient  reason  for 
believing  that  this  must  always  be  the  ease,  and  was 
intended  by  Providence  —  if  indeed  there  was  such  a 
thing  as  a  Providence  —  to  be  so.  In  this  way  at 
least,  it  was  possible  to  go  on  comfortably,  leaving 
things  as  they  found  them,  if  they  chanced  to  belong 
to  the  class  that  had  more  or  less  of  this  world's  good 
things  —  enduring  them,  in  case  the  alternative  should 
prove  to  be  even  worse,  if  they  did  not. 


A  POSSIBLE  SOLUTION  281 

In  this  way  the  tyranny  and  luxury  of  Roman  rule 
drifted  onwards  to  the  violence  and  rude  luxury  of  the 
Middle  Ages,  and  these  again  to  the  conditions  of  mod- 
ern commercialism.  The  outward  appearance  of  most 
things  changed,  but  the  things  themselves  remained. 
Individuals  here  and  there  had  higher  ideals,  and  even 
tried  to  do  good  to  some  extent  while  they  lived  with 
the  riches  they  possessed,  or  still  more  frequently  ar- 
ranged that  benevolent  purposes  should  be  served  by 
those  riches  after  they  died  and  had  no  more  personal 
use  for  them.  In  the  meantime  no  attempt  was  made 
to  realise  a  Kingdom  of  Heaven,  such  as  had  been  an- 
nounced by  the  Teacher  they  professed  to  consider  in- 
fallible. The  same  principle  of  practically  unre- 
strained selfishness  that  had  been  the  foundation  of  the 
earliest  societies  of  men  continued  to  be  the  recognised 
basis  of  society  still.  The  grasping  selfishness  of  the 
days  of  Carthage  and  Eome  continued  to  be  the  root 
of  the  social  conditions  of  modern  nations,  calling 
themselves  Christian;  some  of  its  most  revolting  evi- 
dences had  given  way  to  others  that  were  less  plainly 
offensive,  indeed,  but  the  spirit  of  the  market  place 
—  the  spirit  which  accepts  selfishness  as  the  necessary 
rule  of  every-day  life  and  business  success  —  has  re- 
mained practically  the  same.  To  this  is  owing  the 
great  fortunes  of  to-day;  to  this,  and  to  nothing  but 
this,  is  owing  the  national  legislation  which  accepts  the 
existence  of  a  class  of  the  community  that  lives  on  the 
work  of  the  other  classes,  and  gives  —  or  at  any  rate 
is  expected  to  give  —  nothing  in  return.  To  this  is 
owing  the  ill-feeling  that  exists,  and  very  naturally  ex- 


282      SOCIAL  WELFAEE  IN  NEW  ZEALAND 

ists,  between  the  classes  of  the  capitalists  that  have 
too  much  of  the  world's  wealth,  and  the  workers  who 
have  too  little. 

And,  as  if  to  emphasise  beyond  the  possibility  of 
mistake  the  spirit  of  the  age,  the  commercial  nations 
of  Europe  and  America  have  reduced  all  this  to  a  sci- 
ence. They  have  taken  these  conditions  of  injustice 
and  unfair  dealing,  and  have  built  on  them  a  system 
which  claims  to  be  the  only  system  of  national  well- 
being  and  prosperity.  The  Political  economy  of  the 
schools  and  the  text  books  is  only  the  spirit  of  the  age 
reduced  to  logical  terms.  Like  society  at  large  it  ac- 
cepts the  evil  and  selfish  conditions  that  prevail,  and 
have  prevailed  through  all  the  ages  of  savagery  and 
semi-barbarism,  as  necessary,  and  on  the  whole  desir- 
able things.  They  have  attempted  to  establish  in  the 
minds  of  the  young  a  kingdom,  which  is  certainly  not 
in  any  sense  a  kingdom  of  heaven,  but  in  its  operation 
and  results  is  exactly  the  reverse.  And  in  support  of 
their  teachings  and  dogmatic  theories  they  assert,  as 
something  beyond  the  possibility  of  reasonable  ques- 
tion, that  national  prosperity  can  be  reached  in  no 
other  way.  It  is  needless  to  say  they  take  no  notice 
of  the  proclamation  made  nearly  nineteen  centuries 
ago,  which  announced  the  coming  of  a  new  kingdom, 
which  had  nothing  in  common  with  theirs,  but  promised 
a  new,  and  more  universal  happiness  to  its  people,  and 
a  greater  and  more  real  prosperity  to  the  communities 
that  accepted  it. 

The  science  of  concentrated  selfishness,  and  splendidly 
organised  covetousness,  we  are  told,  is  the  way,  and 


A  POSSIBLE  SOLUTION"  283 

the  only  way  to  national  wealth.  The  Community 
that  accepts  it  most  heartily,  and  practises  it  most 
thoroughly,  must  of  necessity  take  the  lead  among 
the  world's  commercial  nations.  Its  people  —  that  is 
to  say,  of  course,  a  very  few  of  its  people  —  will 
be  the  world's  millionaires.  They  will  be  the  rail- 
way kings,  the  mine-owners,  oil  magnates,  cotton 
princes,  and  captains  of  industry.  As  for  the  rest, 
they  may  get  high  wages  —  which  they  will,  of  course, 
return  to  those  who  pay  them,  in  the  shape  of  extra 
profits  —  and  they  will  have  the  satisfaction  of  belong- 
ing to  a  people  admittedly  in  the  front  rank  of  the 
world's  commercial  nations.  It  is  true  the  experience 
of  the  past  shows  conclusively  that,  under  such  condi- 
tions as  these,  no  nation  has  long  continued  to  prosper, 
and  none  has  continued  to  lead.  It  is  true  that  to-day 
there  are  not  only  one  but  many  writings  on  the  wall 
that  proclaim  the  failure  of  the  policy  of  selfishness, 
and  the  doom  of  nations  given  up  to  the  practice  of 
unbridled  commercialism.  Such  warnings  as  these  did 
not  affect  the  policy  or  the  conduct  of  Eome  before  its 
fall,  or  of  France  before  its  great  revolution  —  Why, 
it  may  be  asked,  should  we  expect  them  to  convince 
the  successful  representatives  of  commercialism  to-day  ? 
It  is  probably  fortunate  that  the  class  of  actual  or 
prospective  millionaires  is  a  small  one  compared  with 
the  other  classes  in  every  nation  that  have  not  the 
temptation  of  riches  to  prevent  them  from  either  ap- 
preciating or  seeking  an  entrance  into  any  community 
possessed  of  the  characteristics  of  a  kingdom  of  heaven. 
The  civilised  world  of  this  twentieth  century  is  under- 


284     SOCIAL  WELFAEE  IN"  KEW  ZEALAND 

going  a  great  awakening,  which  is  probably  hardly  ap- 
preciated as  yet  by  the  select  class  which  most  fully 
represents  and  profits  by  commercialism  to-day.  This 
awakening  means  revolution  in  some  form.  It  may 
mean  an  overturn  of  society,  more  wide-spread,  and 
far  more  terrible  in  many  ways,  than  any  yet  recorded 
in  history:  it  may,  on  the  other  hand,  mean  the  devel- 
opment of  new  and  higher  ideals  of  what  society  may 
be  made  to  mean,  if  men  will  for  once  put  aside  selfish- 
ness, and  do  their  best  to  substitute  a  spirit  of  justice 
and  brotherly  feeling  —  the  essential  principle  of  the 
religion  they  have  for  so  many  centuries  professed, 
and  as  nations  or  communities  have  never  even  at- 
tempted to  practise. 

The  social  conditions  pictured  by  the  great  Teacher 
of  the  Good  ISTews  for  mankind  was  not,  it  should  be 
needless  to  say,  intended  for  a  small  class  of  humanity 
—  indeed  it  is  hardly  an  exaggeration  to  say  that  it 
all  but  excluded  the  class  of  the  rich.  It  was  a  pic- 
ture of  a  real,  but  not  of  an  ideal  Utopia :  —  of  a  so- 
ciety in  which  all  the  members  would  be  treated  with 
justice,  and  all  would  be  assisted,  as  members  of  a 
real  brotherhood.  It  gave  no  hint  of  an  absolute  equal- 
ity of  conditions,  any  more  than  it  asserted  an  equality 
of  personal  talents  and  powers:  what  it  emphatically 
did  was  to  assert  the  responsibility  of  each  member  of 
the  society  for  the  spirit  in  which  he  regarded  the 
special  endowments  and  talents  he  possessed,  as  a  trust 
which  he  held  in  the  first  place  and  chiefly  for  others, 
and  not  for  himself.  Such  a  picture,  while  it  con- 
demned riches,  as  essentially  a  danger  to  those  who 


A  POSSIBLE  SOLUTION  285 

possess  them,  gives  no  liint  of  a  human  society  in  which 
an  attempt  is  made  to  create  an  artificial  equality,  so 
alien  to  the  actual  conditions  of  its  individual  mem- 
bers that  it  must  be  foredoomed  to  an  early,  and  prob- 
ably a  very  disastrous  failure.  But  while  the  original 
proclamation  of  the  Good  ISTews  of  a  kingdom  of  God 
on  earth  gave  little  support  to  the  theories  of  the  ex- 
treme socialists  of  the  present  age,  it  gave  still  less  to 
the  ideals  of  commercialism.  It  foretold  a  reign  of 
righteousness;  not  one  in  which  the  greatest  rewards 
and  the  highest  place  should  be  the  prize  of  the  clever- 
est and  most  unscrupulous  over-reacher  of  his  fellow 
men,  but  of  the  citizen  who  thought  the  least,  and 
cared  the  least  for  his  own  advantage,  and  the  most  for 
that  of  others.  It  proclaimed  a  kingdom  in  which  it 
should  not  be  the  citizen  who,  in  the  true  spirit  of  the 
market  place,  hopes  to  climb  to  riches  and  power  at  the 
expense  of  his  fellows  —  whose  interest  is  absorbed  in 
the  schemes  of  high  finance,  or  in  the  fluctuations  of 
the  share-market,  by  which  he  may  plunder  his  poorer 
and  less  cunning  neighbours  —  who  should  be  success- 
ful, but  the  one  who  was  the  most  unselfish,  and  did  the 
most  to  help  his  brother  men. 

To  the  men  and  the  communities  that  set  this  ideal 
before  them  the  world's  great  Teacher  made  a  promise 
— a  promise  so  strangely  unlike  all  that  men  had  learned 
to  think  natural  and  probable  that  it  can  hardly  be  won- 
dered at  that  those  who  heard  it  first,  and  the  nations  of 
men  who  have  heard  and  read  it  ever  since,  have  been 
slow  to  believe  it.  The  promise,  indeed,  seemed  im- 
possible of  fulfilment,  if  possibilities  were  to  be  reck- 


286     SOCIAL  WELFARE  I^  NEW  ZEALAND 

oned  bj  huinan  experience.  It  was  a  promise  of  suc- 
cess, as  the  result  of  renunciation.  It  was  the  declara- 
tion that  there  exists  a  truer  political  economy  than  that 
of  the  market  place,  and  a  higher  law  than  any  that  can 
be  understood  or  explained  by  a  science  that  is  merely 
human.  It  announced,  as  one  of  the  elementary  laws 
of  the  kingdom  of  heaven  on  earth,  that  wealth  would 
be  given  to  the  Community  that  looked  for  something 
better  than  wealth  for  the  individual;  and  that  pros- 
perity in  the  ordinary  business  and  affairs  of  life  would 
attend  the  nation  that  gave  its  first  thought,  and  its  chief 
attention  to  justice  for  all  its  citizens,  and  the  treatment 
of  all  as  members  of  one  family.  "  All  these  things 
shall  be  added  unto  you,"  was  the  promise  to  the  com- 
munity as  to  the  individual,  that  should  be  ready  to 
abandon  Commercialism,  with  its  selfish  anxieties  and 
struggles;  with  its  petty  ambitions  and  self-seeking 
plans  for  the  future ;  and  to  adopt  in  its  stead  a  policy, 
for  the  nation  as  well  as  the  individual,  of  righteousness, 
fair-dealing,  and  helpfulness  between  man  and  man. 
The  earliest  Christians  took  the  words  of  their  great 
Teacher  literally,  but  they  were  powerless  to  influence 
the  policy  of  nations ;  and  by  the  time  the  professors  of 
the  new  faith  had  become  numerous  enough  to  frame 
policies  and  influence  legislation  and  the  ideas  of  so- 
ciety, they  had  ceased  to  believe  in  the  promise  of  the 
great  Law-giver  of  The  Kingdom  of  Heaven. 

Thus  through  all  the  centuries  that  have  passed  since 
the  first  proclamation  of  the  Good  News  for  men  —  the 
news  that  was  to  reform  society,  and  make  men  one 
family,  in  feeling  and  affection  as  well  as  in  blood,  no 


A  POSSIBLE  S0LUTI0:N'  287 

national  community  has  thought  it  worth  while  to  adopt 
the  policy  of  the  Teacher  whose  name  they  have  assumed, 
while  they  have  in  practice  rejected  his  legislation,  and 
discredited  his  promise.  One  Community  has  at  last 
hegun  to  make  the  experiment,  in  spite  of  much  hostile 
criticism  and  contemptuous  misrepresentation.  Some 
attempt  has  been  made  in  the  preceding  pages  to  show 
what  the  result  of  this  experiment  has  been  during  the 
last  twenty  years  on  the  wealth  of  that  nation  and  the 
happiness  and  well-being  of  its  people.  The  writer  does 
not  pretend  to  say  that  the  experiment  has  yet  been 
fully  made,  or  that  the  policy  has  even  now  been  fully 
developed.  What  he  does  claim,  however,  on  the  evi- 
dence of  the  unquestioned  statistics  of  New  Zealand  is, 
that  a  progressive  policy  of  justice  for  all  classes  of  its 
people,  help  and  reasonable  assistance  to  all  who  needed 
help,  and  the  steady  discouragement  through  its  laws  of 
commercialism,  and  the  spirit  of  the  market  place  — 
in  other  words  of  grasping  selfishness  —  has  been  accom- 
panied and  followed  by  an  economic  success  far  greater, 
in  proportion  to  the  numbers  of  its  people,  than  that 
of  any  other  national  community  in  the  world. 


THE   END 


UNIVERSITY  OF  CALIFORNIA,  LOS  ANGELES 


UNIVERSITY  of  CALIFORNIA 

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